August 14, 2015
Technical Picks |
Range remains intact; Continue following a stock-centric approach
Sensex (28067) / Nifty (8519)
The opening session of the week on Monday began on a flat
Exhibit 1: Nifty Weekly chart
note, in-line with muted global cues. Subsequently, we witnessed
good traction in the market, which pushed the Nifty beyond the
8600 mark. However, in a sudden drift, the Nifty took a nosedive
and tumbled by more than 90 points within a blink of an eye.
The move came in the concluding 45 minutes of trade for the
day. This was followed by two extremely weak sessions owing
to unsupportive news flows on the global as well as the domestic
front. In the process, the Nifty sneaked below the 8400 mark
and traded below the level until Thursday's session. However,
Source: Falcon
on Friday, a massive rally of nearly 2% pulled the Nifty beyond
Exhibit 2: Nifty Daily chart
the 8500 mark. On the sectoral front, IT and Healthcare stocks
were among the major gainers; whereas, the Metal, Oil & Gas
and Capital Goods stocks remained under pressure. The Nifty
ended the week with a marginal cut of 0.54% over the previous
week's closing.
Pattern formation:
The '89-day EMA' and the '89-week EMA' are placed at
27818 / 8421 and 25870 / 7795 levels, respectively.
The '20-day EMA' and the '20-week EMA' are placed at
Source: Falcon
27933 / 8475 and 27840 / 8440 levels, respectively.
a short span of three days. Things were looking extremely bleak
until Thursday; but a stupendous rally on Friday gave a sigh of
Future outlook
relief to the bulls. The recent swing low of 8315 on the Nifty
The price action in the concluded week can be perfectly
played the role of a sheet anchor for the fourth time in the
described as a see-saw between the market participants. After
recent past and thus, it has now become a strong as well as
a couple of weeks' pause, global uncertainties once again
crucial support for the Nifty. We maintain our view that in order
spooked our markets. In line with the depreciation in most
to scale higher, the Nifty will have to convincingly surpass the
leading global currencies, particularly the Chinese Yuan, vis-à-
8650 mark. In this scenario, a possibility of moving towards
vis the USD, the Indian Rupee (INR) too depreciated and is
8720 - 8800 levels increases. To summarize, the Nifty is stuck
currently trading at a two-year low level.
in a small range of 8650 to 8315. A sustainable breakout in
Coming back to our domestic equity markets, technically
either direction beyond these levels will dictate the near term
speaking, we have been clearly observing a major hurdle for
direction of the market. It's advisable to focus on individual
the Nifty around the 8650 mark since the last few weeks. During
stocks as long as the Nifty remains in this consolidation phase.
the week's trading, the inability to cross this resistance contrarily
led to a sharp correction of more than 250 points in the Nifty in
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August 14, 2015
Technical Picks |
Weekly Pivot Levels For Nifty 50 Stocks
SCRIPS
S2
S1
PIVOT
R1
R2
SENSEX
27,050
27,559
27,988
28,497
28,926
NIFTY
8,209
8,364
8,493
8,647
8,776
BANKNIFTY
17,573
18,148
18,610
19,185
19,647
ACC
1,325
1,348
1,379
1,402
1,433
AMBUJACEM
195
211
221
236
246
ASIANPAINT
837
866
891
920
945
AXISBANK
540
555
570
585
600
BAJAJ-AUTO
2,366
2,463
2,518
2,614
2,670
BANKBARODA
171
178
182
189
194
BHEL
241
251
263
273
285
BPCL
782
828
904
950
1,025
BHARTIARTL
358
377
396
414
433
BOSCH LIMITED
23,649
24,518
25,619
26,488
27,589
CAIRN
137
146
157
167
178
CIPLA
681
710
726
755
771
COALINDIA
330
354
386
410
442
DRREDDY
4,107
4,182
4,260
4,335
4,413
GAIL
318
327
337
347
356
GRASIM
3,442
3,573
3,705
3,835
3,967
HCLTECH
905
940
964
998
1,023
HDFCBANK
1,052
1,077
1,091
1,116
1,131
HDFC
1,211
1,256
1,294
1,339
1,378
HEROMOTOCO
2,576
2,644
2,687
2,755
2,798
HINDALCO
76
85
98
107
120
HINDUNILVR
818
844
877
903
936
ICICIBANK
278
290
302
314
326
IDEA
149
155
162
168
174
INDUSINDBK
886
922
943
980
1,000
INFY
1,011
1,080
1,125
1,193
1,238
ITC
292
305
316
329
340
KOTAKBANK
670
694
707
731
744
LT
1,701
1,750
1,797
1,846
1,893
LUPIN
1,640
1,717
1,757
1,834
1,875
M&M
1,256
1,317
1,356
1,417
1,456
MARUTI
4,353
4,463
4,526
4,636
4,699
NMDC
88
93
99
104
110
NTPC
122
126
130
134
138
ONGC
254
262
274
282
293
POWERGRID
120
129
135
145
151
PNB
146
156
162
172
177
RELIANCE
902
935
962
994
1,021
SBIN
237
253
271
287
305
SUNPHARMA
797
848
881
931
965
TCS
2,478
2,590
2,655
2,768
2,832
TATAMOTORS
315
335
365
385
415
TATAPOWER
66
68
69
71
73
TATASTEEL
208
223
244
259
280
TECHM
509
532
550
573
590
ULTRACEMCO
2,917
3,011
3,115
3,208
3,313
VEDANTA
81
94
112
126
144
WIPRO
544
560
571
586
597
YESBANK
719
758
796
835
873
ZEEL
389
405
413
428
437
Technical Research Team
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Derivatives Review |
No traces of formation of longs in bounce back
Nifty spot closed at 8518.55 this week against a close of 8564.60 last week. The Put-Call Ratio has increased from 0.99 to 1.00 levels
and the annualized Cost of Carry is positive at 7.96%. The Open Interest of Nifty Futures decreased by 7.67%.
Put-Call Ratio Analysis
Implied Volatility Analysis
PCR-OI has increased from 0.99 to 1.00 levels. Huge buildup
Implied Volatility (IV) for NIFTY has increased from 13.15% to
was visible in 8400-8700 call options last week. On the other
14.40%. Historical volatility (HV) of NIFTY is at 17.84% and
hand in put options good amount of build-up was seen in 8200
that for BANKNIFTY is trading at 26.95%. Liquid counters having
& 8300 strikes, followed by unwinding in 8500-8600 put
very high HV are JINDALSTEL, VEDL, HINDALCO, HDIL and
options. Maximum buildup in current series is seen in 8700
DLF. Stocks where HV are on lower side are DRREDDY, CESC,
call & 8200 put options.
ASHOKLEY, HAVELLS and ITC.
Open Interest Analysis
Cost-of-Carry Analysis
Total open interest of market has increased from
Nifty current month futures closed at a premium of 24.15 points
`2,13,910/- cr. to `2,23,983/- cr. Stock futures open interest
against a premium of 29.50 points to its spot. Next month
has increased from `66,874/- cr. to `67,297/- cr. Liquid
future is trading with premium of 61.80 points. Liquid counters
counters names which added significant positions last week
where CoC is high are AXISBANK, POWERGRID,
are HINDALCO, DLF, TATASTEEL, SBIN and COALINDIA. On
BANKBARODA, CIPLA and BPCL. Stocks with negative CoC
the other hand unwinding was visible in counters like
are DLF, NMDC, GAIL, MARUTI and TCS.
HEROMOTOCO, SUNPHARMA, AMBUJACEM, INFY and M&M.
Derivative Strategy
Scrip : NIFTY
CMP : `8518.55
Lot Size : 25
Exercise Date (F & O) :
27th. Aug 2015
View: Mildly Bearish
Strategy: Ratio Bear Put Spread
Expected Payoff
Buy/Sell
Qty
Scrip
Strike
Series
Option
Buy/Sell Rate
Closing Price
Expected
Price
Type
(`)
(`)
Profit/Loss
BUY
25
NIFTY
8500
AUG
PE
70.00
8100
(`30.00)
SELL
50
NIFTY
8300
AUG
PE
20.00
8200
`70.00
LBEP
-
8130
UBEP - 8470
8300
`170.00
8400
`70.00
Max. Risk: Unlimited
Max. Profit: `4,250/-
If NIFTY continues to move below LBEP.
If NIFTY closes at 8300 level on expiry.
8500
(`30.00)
NOTE: Profit can be booked before expiry if NIFTY moves in favorable direction and time value decays.
8600
(`30.00)
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Ratings (Based on expected returns
Buy (> 15%)
Accumulate (5% to 15%)
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over 12 months investment period):
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Sell (< -15)