Technical and Derivatives Review | October 20, 2017
Giant stride from last SAMVAT, keep booking profits
Sensex (32584) / Nifty (10121)
(E.O.D as on Oct 18, 2017)
Nifty Daily chart
Source: Trading View
Future outlook
The towering rally continues for our market and if we compare percentage move from last SAMVAT, our markets have taken a giant
stride forward. This Diwali, the Nifty has managed to clock fresh record highs beyond the new milestone of 10200; courtesy to v-
shaped recovery in last three weeks. But, the real question lies whether the same optimism is going to continue or not.
With a broader view certainly ‘Yes’; the ‘Bull Run’ is likely to continue, but if we have to consider slightly smaller picture then we are
still a bit sceptical about it. We continue to believe that the market needs to have some kind of breather to maintain the higher
degree sturdy structure. It sounds a bit contrarian as one would always have a counter argument saying we are at record highs and
there is no negative development around us. Technically speaking, if we closely observe price movement since the beginning of
August, the index has done nothing. We have already witnessed a couple of price shocks after hitting record highs on previous two
occasions and the index is more or less back to same levels. There has been a series of divergences in weekly ‘RSI-Smoothened’ and
considering its historical performance; we certainly do not want to neglect it.
For the coming week, in case of an extended move, we may see Nifty heading towards 10250 - 10310. On the flipside, 10175 -
10100 would be seen as immediate support levels. Going ahead, we continue to advise remaining light on positions and adopting
stock centric approach with a proper exit strategy. This is certainly not a kind of market where you should go long all guns blazing.
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1
Technical and Derivatives Review | October 20, 2017
No meaningful change in F&O data, wait and watch
Nifty spot closed at 10210.85 this week, against a close of 10167.45 last week. The Put-Call Ratio has decreased to 1.62 from 1.63 levels
and the annualized Cost of Carry is positive at 11.91%. The Open Interest of Nifty Futures increased by 2.15%.
Derivatives View
Nifty current month future closed with a premium of 26.65 points against a premium of 24.95 points to its spot. Next month future is
trading with a premium of 56.90 points.
PCR-OI has declined from 1.63 to 1.62 on week on week basis. In call option, 10300 and 10400 strikes added some fresh positions; followed
by some unwinding in 9900-10100 call options. While, in put options, 10200 and 10300 strikes were most active and they also added
significant positions. In addition, some open interest addition was also witnessed in 10000 put option. At present, maximum open interest
concentration for October series is placed at 10200 followed by 10300 call option and for put option firmly stands at 10000 strike.
The benchmark index continue to rally and hits a new record high along with some open interest additions, suggesting continuation of long
formation during preceding week. FIIs too actively participated in recent upmove by forming fresh long positions in index futures. At the
same time, they formed fresh longs in call options along with writing in puts. Looking at the F&O activity in October series, we believe
market may continue its ongoing momentum unless we see relevant change in data.
Long Formation
Short Formation
OI
OI
Price
OI
OI
Price
Scrip
Price
Scrip
Price
Futures
Chg (%)
Chg (%)
Futures
Chg (%)
Chg (%)
IDEA
70210000
9.21
88.85
12.47
AXISBANK
49597200
22.56
466.25
(11.99)
TORNTPHARM
559600
89.57
1392.35
9.45
DCBBANK
7749000
26.15
181.85
(5.39)
PFC
45198000
23.63
132.35
6.52
BAJFINANCE
6096000
15.45
1874.85
(4.43)
TATACHEM
6669000
6.19
728.40
5.25
ZEEL
9731800
33.63
491.50
(4.04)
NCC
26480000
6.57
94.65
4.53
GODREJIND
3630000
13.24
597.65
(3.98)
CGPOWER
28608000
4.88
82.25
4.44
INDIANB
4174000
10.31
264.05
(3.82)
SREINFRA
10690000
14.70
117.30
4.27
COLPAL
1913100
12.05
1052.85
(3.81)
RAYMOND
4308800
5.96
888.85
4.14
ICICIPRULI
6440200
22.47
392.75
(3.56)
Weekly change in OI
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2
Technical and Derivatives Review | October 20, 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
For Technical Queries
E-mail: [email protected]
For Derivatives Queries
E-mail: [email protected]
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