Technical Picks | August 27, 2016
Market indecisive, adopt a stock specific approach
Sensex (27782) / Nifty (8573)
The market started the proceedings of the week on a flat
Exhibit 1: Nifty Weekly chart
note on Monday. Post a minor corrective move, the Nifty was
then restricted within a narrow range of 105 points over the
first three sessions of the week. Thursday’s session, which
coincided with the August 2016 derivatives expiry on NSE,
saw the index open marginally higher. But the gains got
eroded particularly in the last hour of trade, thus leading to
a negative close for the session. The bearish momentum
continued on the last day of the week and the Nifty posted a
weekly loss of 1.09%.
Key Moving Averages:
The ’89-day EMA’ and the ’89-week EMA’ for the
Sensex/Nifty are placed at
27031
/
8306 and
Source: Company, Angel Research
26070 / 7933 levels, respectively.
Exhibit 2: Nifty Hourly chart
The ’20-day EMA’ and the ‘20-week EMA’ for the
Sensex/Nifty are placed at
27942
/
8609 and
27007 / 8293 levels, respectively.
Future outlook
The Nifty has been unable to make a decisive move on
either side and has been gyrating within a thin trading range
of nearly 150 points in the past four weeks. We have been
stating of such likelihood of a sideways trend in the Nifty
since the last three weeks and the index has not proved us
wrong. This in technical terms is termed as a ‘Time-wise
Corrective or Consolidation’ phase. The Nifty is now stuck in
a range of 8500 - 8728. In continuation of our previous
Source: Company, Angel Research
report, a ‘Tri-star’ pattern that was visible on the weekly
chart, is still intact. A pronounced confirmation of this
If we meticulously observe the hourly chart, a ‘Bullish Wolfe
pattern (below 8500) could inflict some weakness in the
Wave’ is clearly visible (refer to exhibit
2). For it to
market. However, we believe the downside would be limited
materialize, we need to wait for a 5th confirmation point
as we do not expect the Nifty to extend the fall beyond
either around 8550 (127% retracement from point 3 to 4) or
8400 - 8364. In a bullish scenario, 8728 stands to be a
at 8520 (161% retracement from point 3 to 4). This pattern
strong resistance and a sustainable move beyond the level
remains valid as long as the Nifty manages to hold 8500
would extend the up move towards 8780 - 8830 where we
and activation of the same may result in a move towards
see major hurdles standing in the near term. Broadly
8680 - 8710 (target of the pattern connecting point
1
speaking, we expect the index to remain in a slightly bigger
and 4). Going forward, since there are no clear signs on the
range of 8830 - 8364 for some time before the next
chart, traders are advised to keep a check of these scenarios
directional move unfolds.
and all key levels. Meanwhile, a stock specific approach
would now be a prudent strategy to follow while picking
potential trades.
For Private Circulation Only
1
Technical Picks | August 27, 2016
Weekly Pivot Levels For Nifty Constituents
SCRIPS
S2
S1
PIVOT
R1
R2
SENSEX
27,421
27,601
27,878
28,059
28,335
NIFTY
8,464
8,518
8,602
8,656
8,739
NIFTY BANK
18,915
19,055
19,274
19,415
19,634
ACC
1,579
1,609
1,652
1,682
1,726
ADANIPORTS
240
249
264
273
289
AMBUJACEM
253
260
269
275
284
ASIANPAINT
1,076
1,100
1,115
1,139
1,154
AUROPHARMA
701
745
775
820
849
AXISBANK
571
579
586
594
602
BAJAJ-AUTO
2,779
2,819
2,884
2,924
2,989
BANKBARODA
153
156
160
163
168
BHEL
129
134
140
145
151
BPCL
557
576
591
610
625
BHARTIARTL
331
338
348
354
365
INFRATEL
332
340
345
352
357
BOSCH
22,769
23,232
23,763
24,226
24,757
CIPLA
542
555
565
577
587
COALINDIA
325
329
333
337
342
DRREDDY
2,939
2,990
3,034
3,085
3,129
EICHERMOT
21,271
21,801
22,077
22,607
22,883
GAIL
353
366
375
388
398
GRASIM
4,377
4,455
4,553
4,631
4,728
HCLTECH
743
761
783
801
823
HDFCBANK
1,229
1,243
1,255
1,269
1,281
HDFC
1,327
1,347
1,368
1,388
1,409
HEROMOTOCO
3,238
3,271
3,319
3,352
3,400
HINDALCO
151
153
156
158
160
HINDUNILVR
879
892
913
926
947
ICICIBANK
236
241
248
252
260
IDEA
88
91
96
100
105
INDUSINDBK
1,131
1,148
1,175
1,191
1,219
INFY
978
999
1,030
1,052
1,083
ITC
247
250
253
256
259
KOTAKBANK
759
770
780
790
800
LT
1,367
1,397
1,451
1,481
1,534
LUPIN
1,467
1,489
1,529
1,551
1,591
M&M
1,378
1,401
1,432
1,455
1,486
MARUTI
4,718
4,819
4,902
5,003
5,085
NTPC
150
154
161
165
173
ONGC
232
235
239
243
247
POWERGRID
177
179
182
184
187
RELIANCE
995
1,012
1,021
1,037
1,047
SBIN
236
242
251
256
266
SUNPHARMA
732
744
764
776
797
TCS
2,461
2,493
2,549
2,581
2,637
TATAMTRDVR
302
316
328
341
353
TATAMOTORS
472
488
502
517
531
TATAPOWER
71
73
76
79
82
TATASTEEL
352
361
376
385
400
TECHM
445
452
463
471
482
ULTRACEMCO
3,658
3,731
3,829
3,902
4,000
WIPRO
466
478
500
512
534
YESBANK
1,300
1,313
1,332
1,346
1,365
ZEEL
487
496
511
521
535
Technical Research Team
For Private Circulation Only
2
Derivatives Review | August 27, 2016
Rollover data dictates limited downside
Nifty spot closed at 8572.55 this week, against a close of 8666.90 last week. The Put-Call Ratio has decreased from 1.06 to 1.04
levels and the annualized Cost of Carry is positive at 6.57%. The Open Interest of Nifty Futures decreased by 2.14%.
Derivatives View
Weekly OI gainers
OI
OI
Price
Scrip
Price
Nifty current month future closed with a premium of 52.45
Futures
Chg (%)
Chg (%)
points against a premium of 60.20 points to its spot. Next
STAR
2547000
48.77
958.45
(3.04)
month future is trading with premium of 92.35 points.
TORNTPHARM
296400
43.88
1626.25
4.54
PCR-OI has decreased from 1.06 to 1.04 levels. Being start of
NCC
24632000
27.97
83.80
(1.70)
new series, the overall build-up in quite scattered. In call
GAIL
10710000
25.62
377.40
3.40
options, 8600-9000 strike added huge positions. While, we
saw good amount of open interest addition in 8300 to 8700
OIL
1725500
23.48
379.75
0.93
put options. Highest open interest in September series is
PFC
23748000
19.87
116.65
(1.64)
placed at 9000 call and 8500 put options.
MRF
65550
16.66
36652.35
1.16
Stock that added longs last week are ENGINERSIN, RCOM,
PETRONET
3126000
16.29
337.70
(1.72)
DHFL, BIOCON and LICHSGFIN. While, fresh shorts were
visible in NTPC, NIITTECH, WIPRO, LT and LUPIN. Liquid
counters with higher CoC are LT, TATASTEEL, INDUSINDBK,
Weekly OI losers
ZEEL and HINDUNILVR. Stocks with negative CoC are BHEL,
OI
OI
Price
TATAPOWER, ONGC, GAIL and NTPC.
Scrip
Price
Futures
Chg (%)
Chg (%)
Despite, being expiry week we saw Nifty trading in a very
GODREJIND
1222500
(49.69)
426.65
2.03
narrow range. Rollover in Nifty is above its last 2 years
JPASSOCIAT
144432000
(33.46)
11.35
1.34
averages. Most of the positions formed were longs and we
CASTROLIND
6785800
(27.95)
429.00
6.03
believe they have been rolled too. Just ahead of expiry day,
we saw some short formation by FIIs in Index Futures for
VOLTAS
3926000
(26.48)
392.30
2.48
nearly 2 - 3 sessions; but, these positions weren’t rolled in
HINDZINC
4476800
(26.37)
225.95
(1.76)
current series. FIIs have again formed fresh longs in Index
AJANTPHARM
315200
(25.45)
1983.20
0.37
Futures on first trading session of September series. At current
juncture, Nifty has strong support around 8500 - 8550 levels.
GODREJCP
363600
(23.87)
1524.00
(1.35)
Looking at the above data, we don’t expect Nifty breaching its
CUMMINSIND
568800
(23.36)
898.35
0.22
support zone any time soon.
Weekly change in OI
20,000
Call
Put
10,000
0
-10,000
-20,000
-30,000
-40,000
-50,000
-60,000
For Private Circulation Only
3
Research Team Tel: 022 - 39357800
Website: www.angelbroking.com
For Technical Queries
E-mail: [email protected]
For Derivatives Queries
E-mail: [email protected]
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