Technical and Derivatives Weekly Review - August 18, 2023

For Private Circulation Only

Technical and Derivatives Review |August 18, 2023

Market continues to remain sluggish, eyes on global development

Sensex (64949) / Nifty (19310)

Source: Tradingview.com

Future Outlook

Trading for the week began with a downside gap on Monday and due to extended weakness in the financial space, Nifty went on to

test 19300 on the same day. Fortunately, a sharp tail end recovery rescued our markets from the crucial support zone. A similar

price action was replicated during the remainder of the week. However, with bears maintaining their dominance overall, we

concluded the truncated week tad above 19300 by shedding nearly a percent from the previous weekly close.

Although, the correction has not been severe, the Nifty has marked negative close in last four consecutive weeks. The global

headwinds and banking related concerns post the RBI policy are keeping our markets under pressure, whereas the inherent strength

in other spaces is providing some support at lower levels. To summarize, key indices are stuck in a range and till we do not find any

major trigger, the consolidation is likely to continue. If we take a meticulous glance at the hourly chart, we can see ‘Three-point

Positive divergence’ in RSI-Smoothened oscillator. This development did trigger some smart recovery around the midsession; but

due to lack of follow up, we saw few downticks towards the end. Nevertheless, the structure is still intact and hence, we will not be

surprised to see some buying emerging at lower levels (provided there is no major global aberration). The first sign of revival would

be confirmed once Nifty sustains above 19370 – 19400 levels, which may then push Nifty towards the next cluster of 19550 – 19650.

On the flipside, 19250 is to be seen as a critical support; because a drift below this would result in a sharp correction towards the

major support zone of 19100 – 19000 (which seems unlikely at this moment). Traders should refrain from complacent trades and

continue with one step at a time approach.

For Private Circulation Only

Technical and Derivatives Review |August 18, 2023

Sho

Form

ion

Long Short Ratio slightly advanced to 42%

Nifty spot closed at 19310.15 this week, against a close of 19428.30 last week. The Put-Call Ratio has increased from 0.91 to 0.98 on

a weekly basis. The annualized Cost of Carry is positive at 3.10%. The Open Interest of Nifty Futures increased by 1.50%.

Derivatives View

Nifty current month’s future closed with a premium of 21.35 against a premium of 76.05 points to its spot in the previous week.

Next month’s future is trading at a premium of 128.55 points.

The Indian Equity market witnessed a dull trading week, wherein the benchmark index stayed in a slender range-bound stature and

eventually settled around 19300 with a cut of 0.61 percent. On the derivatives front, short formations were seen in key indices on a

weekly basis, suggesting a weakened undertone. On the options front, 19300-19200 put strikes have significant piling of open

interest, indicating a nearby support zone. While on the flip side, the scattered positioning of OI can be seen from 19300-19600 call

strikes, with the highest OI concentration at 19400 CE. The stronger hands added mixed bets in equities and with a strong short

covering in the last session, the ‘Long Short Ratio’ slightly advanced to 42% from 40% on a WoW basis. Considering the mentioned

data, our markets are likely to stay range bound and await some trigger to gain momentum.

Scrip

Futures

Chg (%)

Price

Chg(%)

MUTHOOTFIN 6732000 44.25 1237.40 (8.09)

HINDCOPPER 31932500 31.32 140.80 (11.17)

KOTAKBANK 32965200 15.09 1755.80 (2.52)

COFORGE 991200 13.31 4932.40 (5.33)

HDFCAMC 3231600 12.52 2469.55 (2.76)

Weekly change in OI

Long Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

ESCORTS 1600225 44.07 2834.15 9.37

SYNGENE 3818000 17.37 804.20 0.73

NMDC 92011500 7.92 115.40 0.96

TRENT 4259200 5.14 1973.85 4.40

PVRINOX 3687420 2.36 1721.75 4.52

For Private Circulation Only

Technical and Derivatives Review |August 18, 2023

Sameet Chavan Head Research – Technical & Derivatives sameet.chavan@angelone.in

Sneha Seth Senior Analyst – Technical & Derivatives sneha.seth@angelone.in

Rajesh Bhosale Analyst – Technical rajesh.bhosle@angelone.in

Osho Krishan Senior Analyst – Technical & Derivatives osho.krishan@angelone.in

Hitesh Rathi Analyst – Technical & Derivatives hitesh.rathi@angelone.in

Research Team Tel: 022 - 39357600 Website: www.angelone.in

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For Derivative Queries E-mail: derivatives.desk@angelone.in

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Technical and Derivatives Review |August 18, 2023

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