Technical and Derivatives Review | December 15, 2017
10410 becomes a trend deciding level, till then keep booking longs
Sensex (33463 ) / Nifty (10333)
Source: Trading View
Future outlook
This week, market behaved like a double-edged sword as we saw some volatile sessions with slightly wider trading range. The rise in
volatility was quite evident on the back of major events on global as well as domestic front. Eventually, the bulls had the upper hand
as we saw index closing at the highest point of the week after all exit polls indicating BJP’s victory with a majority in Gujarat
assembly elections.
Technically speaking, market took a u-turn precisely after testing 61.8% retracement level (10140) of the recent up move. Last week,
we were of the opinion that 10330 would be seen as a trend deciding level and the Nifty has managed to close around it. But, the
kind of follow up move was expected after the breakout was clearly missing. And now, the market has factored in BJP’s win with
majority and unless there is more surprising outcome from final results, it would be difficult for this rally to sustain at higher levels.
Hence, now, we consider 10410 as a trend deciding level and any sustainable move beyond this may result into an extension of the
rally.
Having said that if we look at the daily chart meticulously, the way Nifty closed with a small candle precisely at the pull back level of
the ‘Upward Sloping Trend Line’, we do not want to get gung ho with the move until we get some further confirmation. The wise
strategy would be to keep booking profits and re-enter only above 10410. Till then it’s advisable to stay light and in case of Nifty
breaking the 10250 mark, we would see resumption of recent corrective move in the market.
For Private Circulation Only
1
Technical and Derivatives Review | December 15, 2017
Data unclear, better to stay light
Nifty spot closed at 10333.25 this week, against a close of 10265.65 last week. The Put-Call Ratio has increased to 1.29 from 1.26
levels and the annualized Cost of Carry is positive at 7.13%. The Open Interest of Nifty Futures decreased by 3.88%.
Derivatives View
Nifty current month future closed with a premium of 26.25 points against a premium of 26.00 points to its spot. Next month future
is trading with a premium of 58.85 points.
PCR-OI has surged from 1.26 to 1.29 on week on week basis. In call options, build-up was scattered in the range 10500-10800
strikes; followed by unwinding in 10300 call options. On the flip side, decent amount of build-up was seen in 10200-10300 put
options. For December series, maximum open interest concentration remains intact in 10500 call and 10000 put option.
Last week was indeed a roller coaster ride for our market; we witnessed index hovering in the range of 10100-10400 with volatility
on the higher side. The volatility index surpassed its resistance zone of 15.50-15.60 after the period of ten months; this was
expected this time owing to the Gujarat elections. We witnessed decent amount of unwinding in Nifty as well as BankNifty index
during last week; stronger hands (FIIs) too unwounded their positions. At present, 10350-10400 is a strong hurdle for index; whereas
support is placed around 10000 mark. Looking at the above data points, we would advise traders avoiding any aggressive positions
in either direction until we see a breakout from the above mentioned range.
Long Formation
Short Formation
OI
OI
Price
OI
OI
Pric
Scrip
Price
Scrip
Price
Futures
Chg (%)
Chg (%)
Futures
Chg (%)
Chg (%
WOCKPHARMA
3869600
22.02
775.05
9.44
HEXAWARE
5631000
39.55
321.00
(2.9
TATACOMM
8226100
10.58
689.70
1.26
CIPLA
9486000
19.53
578.60
(4.3
BALKRISIND
586800
9.56
2484.70
4.02
BANKINDIA
16608000
19.26
177.85
(4.3
DALMIABHA
758400
8.22
3202.85
2.82
INDIGO
2671200
17.65
1136.70
(4.2
WIPRO
41498400
7.03
285.20
1.75
BEML
2365500
15.53
1510.05
(5.6
Weekly change in OI
For Private Circulation Only
2
Technical and Derivatives Review | December 15, 2017
Technical and Derivatives Team:
Sameet Chavan
Chief Analyst - Technical & Derivatives
[email protected]
Ruchit Jain
Technical Analyst
[email protected]
Rajesh Bhosale
Technical Analyst
[email protected]
Sneha Seth
Derivatives Analyst
[email protected]
Research Team Tel: 022 - 39357600
Website: www.angelbroking.com
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E-mail: [email protected]
For Derivatives Queries
E-mail: [email protected]
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