For Private Circulation Only
Technical and Derivatives Review
| April 24, 2020
8900-9000 becomes a crucial support now
Sensex (31327) / Nifty (9154)
Source: Trading View
Future outlook
During the week, we witnessed swings on both sides as market clearly looked clueless. Importantly, the overall trading range has shrunk
drastically, which is a sign of consolidation. The similar sort of action was seen across the globe as well and hence, with lack of major
triggers, the Nifty eventually concluded the week with more than a percent cut.
Clearly, the market is trapped in a slender range and this week it vacillated within 450-500 points, which is well below it’s recent average.
Of course, the INDIA VIX which was at 12-year high towards the end of the March, has cooled off considerably to enter sub-40 mark. Now, if
we meticulously observe the daily chart, the Nifty is gyrating within the boundaries of a ‘Rising Wedge’ pattern and we are approaching the
‘Apex’ point now. So theoretically, we are likely to see a breakout happening soon (probably in 2-3 sessions) from the consolidation. As of
now, we are hoping for the breakout to happen in upward direction (above 9400), which would then propel the rally towards 9500-9700
However this is just an assumption as of now and hence, if Nifty breaks lower before surpassing the upper boundary, traders should exit
longs and then get ready for some correction in the market. Therefore, 9400 on the higher side and 8900 on the lower side are the levels to
watch out for. At present, it’s advisable to keep a note of above mentioned scenarios and should ideally adopt a stock centric approach.
For Private Circulation Only
Technical and Derivatives Review
| April 24, 2020
Shorts in Bank Nifty leads to underperformance
Nifty spot closed at 9154.40 this week, against a close of 9266.75 last week. The Put-Call Ratio has decreased from 1.38 to 1.34. The
annualized Cost of Carry is negative at 10.73%. The Open Interest of Nifty Futures has decreased by 1.36%.
Derivatives View
Nifty current month future closed with a discount of 16.15 points against a premium of 44.55 points to its spot. Next month future is
trading with a premium of 9.40 points.
As far as Nifty options activities for the week are concerned, we witnessed some open interest addition in 9300-9500 call options
whereas 9000 put options too witnessed decent amount of fresh open interest addition. Maximum open interest for the monthly
series now stands at 9500 call option and 9000 put option.
During the week, the Nifty oscillated within the range of 8900-9400. No significant open interest addition was seen in Nifty index but
Bank Nifty futures witnessed about 17 percent rise in open interest which were short positions. Hence, Bank Nifty index under
performed during the week. FII’s added some short positions in index futures during the week. According at the options data, 9000-
9500 is the immediate trading range as good amount of open interest is seen in these strikes. A breakout beyond this range could
lead to a directional move in the direction of the breakout.
Long Formation
Chg (%)
Chg (%)
BEL 24690000 50.57 74.70 4.04
GLENMARK 4205600 35.25 345.25 9.14
AUROPHARMA 10666000 29.61 625.35 14.61
COLPAL 2109100 23.18 1487.55 7.61
BRITANNIA 1475400 23.18 3003.00 5.59
Weekly change in OI
Short Formation
Chg (%)
hg (%)
UJJIVAN 4440400 86.97 163.05
TATASTEEL 21385500 53.02 265.95 (9.82)
L&TFH 35352800 35.82 55.50
CENTURYTEX 2391600 34.07 284.25
RBLBANK 27454500 31.70 107.35
For Private Circulation Only
Technical and Derivatives Review
| April 24, 2020
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Technical and Deri
vatives Team:
Sameet Chavan Chief Analyst – Technical & Derivatives sameet.cha[email protected]ng.com
Ruchit Jain Technical Analyst ruchit.jain@angelbroking.com
Rajesh Bhosale Technical Analyst rajesh.bhosl[email protected]ng.com
Sneha Seth Derivatives Analyst [email protected]gelbroking.com