February 21, 2015
Technical Picks |
All eyes on Union Budget - Stay light ahead of the event
Sensex (29231) / Nifty (8834)
Trading for the week began on Monday with the market opening
Exhibit 1: Nifty Weekly chart
with a marginal upside gap. However, the Nifty failed to
maintain its position at the higher levels due to modest profit
booking in some of the heavyweight constituents. On
Wednesday, the Nifty opened quietly, but a fair amount of buying
interest in some of the constituent stocks pushed it higher and
led it to close well inside the positive territory. The final two
sessions of the week traded with immense volatility and the
Nifty struggled to cross the 8900 mark on a sustainable basis.
The Capital Goods, FMCG, Metal and Auto stocks were the
major gainers; whereas the Banking, Oil & Gas and Healthcare
Source: Falcon
sectors remained under pressure during the entire week. The
Exhibit 2: Nifty Daily chart
Nifty ended the concluded week with a nominal gain of 0.32%
over the previous week's closing.
Pattern formation:
The '89-day EMA' and the '89-week EMA' are placed at
27921 / 8402 and 24358 / 7302 levels, respectively.
The '20-day EMA' and the '20-week EMA' are placed at
28875 / 8723 and 27975 / 8418 levels, respectively.
Future outlook
Source: Falcon
A smart recovery in the previous week got extended marginally
in the concluded week; but the Nifty struggled to mark its position
doesn't bode well for the bulls. However, the pattern needs a
above the 8900 mark on a closing basis. Although the Nifty
confirmation in the form of a close below the low i.e. 8794.45
has managed to move slightly higher, the overall movement
in the current scenario. Thus, going forward, if the Nifty manages
was quite range bound as we had mentioned in our previous
to close below this important level then we may witness an
report. The level of 8900 on the Nifty coincides with the 78.6%
immediate correction towards 8680 - 8600 levels. On the
Fibonacci retracement level of the recent fall from 8996.60 to
flipside, a breach of the high of the pattern (8913.45) would
8470.50 and hence, acted as a strong resistance for the index.
negate this pattern and in this case, the Nifty may continue its
Thursday's price action was quite interesting as we witnessed
northward movement to test 8950 - 8980 levels.
wild swings on both side. The Nifty managed to close with
The Finance Ministry will be announcing the Union Budget on
marginal gains on the day but the intraday price movement
February 28, 2015. Thus, we would advise traders to remain
has resulted in the formation of a 'Hanging Man' Japanese
light on positions and let the event unfold, which may probably
candlestick pattern. The said pattern has a negative implication
dictate the near term direction.
and an occurrence of it near the important resistance zone
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February 21, 2015
Technical Picks |
Weekly Pivot Levels For Nifty 50 Stocks
SCRIPS
S2
S1
PIVOT
R1
R2
SENSEX
28,840
29,036
29,279
29,475
29,719
NIFTY
8,727
8,780
8,847
8,900
8,967
BANKNIFTY
18,504
18,789
19,161
19,445
19,817
ACC
1,563
1,592
1,628
1,657
1,693
AMBUJACEM
254
259
266
270
278
ASIANPAINT
804
815
829
839
853
AXISBANK
536
549
566
579
597
BAJAJ-AUTO
2,148
2,178
2,229
2,258
2,310
BANKBARODA
171
177
182
188
193
BHEL
248
261
269
283
290
BPCL
704
723
740
759
776
BHARTIARTL
337
343
354
360
372
CAIRN
245
249
256
260
267
CIPLA
654
665
679
689
703
COALINDIA
368
375
383
390
398
DLF
141
146
152
157
164
DRREDDY
3,267
3,336
3,380
3,449
3,493
GAIL
396
403
409
415
421
GRASIM
3,655
3,708
3,804
3,857
3,953
HCLTECH
1,938
1,969
2,012
2,044
2,087
HDFCBANK
1,040
1,057
1,073
1,090
1,106
HDFC
1,229
1,281
1,319
1,371
1,410
HEROMOTOCO
2,506
2,583
2,722
2,798
2,938
HINDALCO
145
151
156
162
167
HINDUNILVR
866
883
903
920
940
ICICIBANK
317
324
335
342
354
IDFC
164
167
171
174
178
INDUSINDBK
828
852
867
891
906
INFY
2,215
2,249
2,292
2,327
2,370
ITC
368
382
392
406
416
JINDALSTEL
125
160
184
218
243
KOTAKBANK
1,263
1,280
1,302
1,320
1,341
LT
1,603
1,640
1,678
1,715
1,752
LUPIN
1,637
1,664
1,685
1,712
1,733
M&M
1,143
1,197
1,231
1,286
1,320
MARUTI
3,472
3,510
3,580
3,618
3,688
NMDC
135
139
142
145
148
NTPC
139
143
145
148
151
ONGC
320
326
335
340
350
POWERGRID
149
151
153
155
157
PNB
158
163
167
171
175
RELIANCE
837
855
890
908
942
SSLT
194
205
215
227
237
SBIN
288
295
304
311
320
SUNPHARMA
894
903
917
927
941
TCS
2,499
2,587
2,643
2,731
2,787
TATAMOTORS
546
563
578
595
610
TATAPOWER
81
83
86
89
91
TATASTEEL
357
366
374
383
391
TECHM
2,697
2,754
2,851
2,907
3,005
ULTRACEMCO
2,912
2,963
3,057
3,108
3,201
WIPRO
633
641
656
665
680
ZEEL
343
351
358
366
374
Technical Research Team
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February 21, 2015
Derivatives Review |
Upside is limited till expiry
Nifty spot closed at 8833.60 this week against a close of 8805.50 last week. The Put-Call Ratio has decreased from 0.98 to 0.94
levels and the annualized Cost of Carry is positive at 10.92%. The Open Interest of Nifty Futures increased by 0.72%.
Put-Call Ratio Analysis
Implied Volatility Analysis
PCR-OI has decreased from 0.98 to 0.94 levels mainly due to
Implied Volatility (IV) for NIFTY has increased from 14.96%.to
open interest addition in call options. Huge buildup was visible
18.70%. Historical volatility (HV) of NIFTY is at 17.92% and
in 8900-9100 call options last week, followed by unwinding in
that for BANKNIFTY is trading at 28.23%. Liquid counters having
8600 & 8700 call options. On the other hand in put options
very high HV are JINDALSTEL, HDIL, INDIACEM, UNITECH and
8700-8900 strike price added decent buildup. Maximum
CESC. Stocks where HV are on lower side are BAJAJ-AUTO,
buildup in current series is seen in 9000 call & 8800 put options.
HDFCBANK, NTPC, COLPAL and DIVISLAB.
Open Interest Analysis
Cost-of-Carry Analysis
Total open interest of market has increased from
Nifty current month futures closed at a premium of 15.85 points
`2,40,738/- cr. to `2,56,399/- cr. Stock futures open interest
against the premium of 36.05 points to its spot. Next month
has increased from `73.788/- cr. to `76,237- cr. Liquid counters
future is trading with premium of 75.95 points. Liquid counters
names which added significant positions last week are CESC,
where CoC is high are JPASSOCIAT, IFCI, HDIL, POWERGRID
HEROMOTOCO, PETRONET, TITAN and DLF. On the other hand
and RANBAXY. Stocks with negative CoC are INDUSINDBK,
unwinding was visible in counters like M&M, BPCL, MINDTREE,
BOSCHLTD, IBREALEST, UNITECH and GAIL.
DIVISLAB and GLENMARK.
Derivative Strategy
Scrip : NIFTY
CMP : 8849.45
Lot Size : 25
Exercise Date (F & O) :
26th. Feb 2015
View: Mildly Bearish
Strategy: Long Put.
Expected Payoff
Buy/Sell
Qty
Scrip
Strike
Series
Option
Buy/Sell Rate
Closing Price
Expected
Price
Type
(`)
(`)
Profit/Loss
BUY
25
NIFTY
8800
FEB
PE
40.00
8575
`185.00
BEP
-
8760
8650
`110.00
8725
`35.00
Max. Risk: `1,000/-
Max. Profit: Unlimited
If NIFTY closes on or above strike price.
If NIFTY continues to move below BEP.
8800
(`40.00)
3875
(`40.00)
NOTE: Profit can be booked before expiry if NIFTY moves in favorable direction and time value decays.
8950
(`40.00)
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Accumulate (5% to 15%)
Neutral (-5 to 5%)
Ratings (Returns) :
Reduce (-5% to -15%)
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