Technical and Derivatives Review | April 20, 2018
Some vigilance near 10600 - 10640
Sensex (34416 ) / Nifty (10564)
Source: Trading View
Future outlook
Our benchmarks continued their recovery mode for the straight fourth week after sliding tad below the 10000 mark. However, in
the week gone by, the momentum seems to have disappeared and it was evident also, as Nifty approached the strong resistance
zone of 10600 - 10640. There was no major addition after Monday’s session and hence, the Nifty concluded the week with a modest
gain of eight tenths of a percent.
Let’s see why 10600 - 10640 is considered a sturdy wall. There are few technical evidences that justify its significance. Firstly, post
the ‘Union Budget’ correction, Nifty corrected from 10638 and 10631 on two occasions, which will now act as a strong hurdle. This
almost coincides with the 50% Fibonacci retracement of the recent fall from 11171.55 to 9951.90. In addition, the ‘Upward Sloping
Trend line’ connecting previous bottoms (9687.55 and 10276.30) is now converging around the same area. Hence, as a chartist,
traders are respecting this zone of 10600 - 10640. In case of violation of this hurdle in the upward direction on a sustainable basis,
we may see relief rally getting extended 10720 - 10750; but it certainly does not change the broader outlook, as we still expect a
possibility of selling pressure resuming at higher levels.
Hence, traders are advised to stay light for a while, keep focusing on key levels and adopt a stock centric approach for next few days.
As far as support levels are concerned, 10495 followed by 10355 would now be seen as crucial points.
For Private Circulation Only
1
Technical and Derivatives Review | April 20, 2018
Plummeted INDIAVIX hints further upside
Nifty spot closed at 10564.05 this week, against a close of 10480.60 last week. The Put-Call Ratio has decreased from 1.63 to 1.62
and the annualized Cost of Carry is positive at 12.35%. The Open Interest of Nifty Futures increased by 8.57%.
Derivatives View
Nifty current month future closed with a premium of 21.45 points against a premium of 9.80 points to its spot. Next month future is
trading with a premium of 49.30 points.
In Nifty options front, we saw build-up in 10600 and 10700 call options along with decent unwinding in 10400 and 10500 strikes. On
the flip side, 10500 and 10600 put options added good amount of OI, suggesting immediate strong support around 10500-10550
levels. Maximum open interest concentration for April series is placed at 10700 call and 10500 put options.
As anticipated in the earlier article, the benchmark index consolidated in a narrow range to conclude the week tad above 10550
mark. We witnessed fresh long formations in index futures segment and FIIs too participated. Their ‘Long Short Ratio’ surged from
26% to 39% last week; which is a positive development. At the same time, the volatility index stands lowest for this calendar year.
We also witnessed huge writing in 10500 and 10600 put options, hinting expiry above 10500-10550 levels. Taking this data into
consideration, we expect continuation of ongoing momentum in the expiry week.
Long Formation
Short Formation
OI
OI
Price
OI
OI
Pric
Scrip
Price
Scrip
Price
Futures
Chg (%)
Chg (%)
Futures
Chg (%)
Chg (%
MINDTREE
3830400
24.49
966.05
13.25
HINDPETRO
32971050
23.64
299.90
(10.22)
NATIONALUM
61240000
31.71
86.40
11.92
ANDHRABANK
25790000
13.21
39.25
(8.83)
DCBBANK
7515000
52.37
195.00
8.54
CANBK
12480000
16.35
259.30
(8.75)
TCS
9017000
13.96
3401.45
7.92
BPCL
21600000
30.92
372.70
(8.39)
OFSS
97650
31.78
4323.10
7.05
BALRAMCHIN
19474000
15.80
67.90
(6.92)
Weekly change in OI
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2
Technical and Derivatives Review | April 20, 2018
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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