February 28, 2015
Technical Picks |
Nifty regains 8900; sustenance of the level dicey
Sensex (29362) / Nifty (8902)
The Nifty kick-started the week with a marginal upside gap on
Exhibit 1: Nifty Weekly chart
Monday. However, it struggled to maintain its position at the
higher levels due to consistent selling pressure in the heavyweight
constituents. A similar movement was seen in the following
sessions until Friday, thereby leading the Nifty to slip below the
8700 mark. The remaining two trading sessions of the week
were completely dominated by the bulls on expectations from
the Union Budget and then post the event. Most of the sectors
ended in the positive territory amongst which the Banking,
Capital Goods, Healthcare, Realty and Oil & Gas were the
major gainers; whereas the FMCG stocks ended the week with
Source: Falcon
a massive cut. The Nifty ended the concluded week with a gain
Exhibit 2: Nifty Daily chart
of 0.77% over the previous week's closing.
Pattern formation:
The '89-day EMA' and the '89-week EMA' are placed at
28035 / 8450 and 24466 / 7337 levels, respectively.
The '20-day EMA' and the '20-week EMA' are placed at
28923 / 8755 and 28094 / 8464 levels, respectively.
Future outlook
The extended week on account of Union Budget traded with
Source: Falcon
immense volatility; but eventually turned in favor of the bulls.
After witnessing a roller coaster ride, the Nifty eventually
coincides with the higher end of the 'Megaphone' pattern on
managed to regain the 8900 mark on a closing basis. As a
the weekly chart, which we have been mentioning over the past
result, the daily chart now displays a 'Trend Line' breakout.
few weeks. Hence, going forward, we would avoid trading
Considering this development and the ongoing momentum,
aggressively long in the market and would advise traders to
the Nifty may extend this rally towards 9050 - 9150 levels if it
start booking profits on the rallies. On the flipside, the 'Upward
manages to sustain above the 8950 mark. Since Saturday's up
Sloping Trend Line' level of 8700 has now become an important
move was mainly propelled by a selective few sectors, we are
support on a closing basis. The near term uptrend remains
not expecting a further significant move on the upside. In
intact so long as this level is not violated.
addition, the mentioned resistance zone of 9050 - 9150
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Technical Picks |
Weekly Pivot Levels For Nifty 50 Stocks
SCRIPS
S2
S1
PIVOT
R1
R2
SENSEX
28,339
28,850
29,205
29,717
30,072
NIFTY
8,566
8,734
8,837
9,005
9,109
BANKNIFTY
18,039
18,865
19,316
20,142
20,593
ACC
1,560
1,619
1,662
1,721
1,764
AMBUJACEM
247
260
266
279
285
ASIANPAINT
767
793
813
839
859
AXISBANK
514
563
591
640
668
BAJAJ-AUTO
2,047
2,100
2,161
2,215
2,276
BANKBARODA
161
173
182
194
204
BHEL
236
249
265
279
295
BPCL
703
725
748
770
793
BHARTIARTL
332
344
352
365
373
CAIRN
234
245
250
260
265
CIPLA
644
663
674
693
704
COALINDIA
370
382
390
402
411
DLF
136
146
155
164
173
DRREDDY
3,102
3,225
3,325
3,448
3,548
GAIL
385
399
408
422
431
GRASIM
3,483
3,618
3,716
3,851
3,948
HCLTECH
1,928
1,974
2,002
2,048
2,076
HDFCBANK
1,016
1,044
1,063
1,090
1,109
HDFC
1,254
1,295
1,337
1,378
1,421
HEROMOTOCO
2,565
2,625
2,660
2,720
2,755
HINDALCO
140
147
154
160
168
HINDUNILVR
865
888
903
925
940
ICICIBANK
310
328
338
356
366
IDFC
158
166
171
178
183
INDUSINDBK
807
862
892
947
977
INFY
2,203
2,250
2,292
2,339
2,382
ITC
312
337
373
398
435
JINDALSTEL
166
181
195
210
225
KOTAKBANK
1,270
1,333
1,371
1,434
1,472
LT
1,616
1,692
1,746
1,822
1,876
LUPIN
1,549
1,648
1,700
1,799
1,851
M&M
1,222
1,257
1,280
1,315
1,338
MARUTI
3,428
3,525
3,579
3,676
3,730
NMDC
130
135
140
144
149
NTPC
137
146
154
163
170
ONGC
303
314
324
335
345
POWERGRID
147
152
156
160
164
PNB
152
159
165
172
178
RELIANCE
819
842
860
882
900
SSLT
199
208
217
226
234
SBIN
280
291
299
309
317
SUNPHARMA
835
873
898
937
962
TCS
2,560
2,618
2,674
2,731
2,788
TATAMOTORS
542
567
583
609
625
TATAPOWER
78
82
86
90
94
TATASTEEL
326
341
359
373
391
TECHM
2,694
2,779
2,824
2,909
2,954
ULTRACEMCO
2,863
2,999
3,089
3,226
3,316
WIPRO
632
646
657
671
683
ZEEL
328
337
349
359
371
Technical Research Team
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Derivatives Review |
Budget not as good as it appears from short term though FII's have bought
Nifty spot closed at 8901.85 this week against a close of 8833.60 last week. The Put-Call Ratio has decreased from 0.94 to 0.86
levels and the annualized Cost of Carry is positive at 9.90%. The Open Interest of Nifty Futures decreased by 1.28%.
Put-Call Ratio Analysis
Implied Volatility Analysis
PCR-OI has decreased from 0.94 to 0.86 levels mainly due to
Implied Volatility (IV) for NIFTY has decreased from 18.70%.to
open interest addition in call options. Huge buildup was visible
16.75%. Historical volatility (HV) of NIFTY is at 18.61% and
in 8800-9500 call options last week, wherein 9000 & 9200
that for BANKNIFTY is trading at 31.57%. Liquid counters having
call options added significant buildup. On the other hand in
very high HV are UNITECH, JINDALSTEL, HDIL, INDIACEM and
put options 8500-8900 strike price added decent buildup.
GMRINFRA. Stocks where HV are on lower side are
Maximum buildup in current series is seen in 9000 call & 8500
BAJAJ-AUTO, L&TFH, WIPRO, COLPAL and HDFCBANK.
put options.
Open Interest Analysis
Cost-of-Carry Analysis
Total open interest of market has decreased from
Nifty current month futures closed at a premium of 62.80 points
`2,56,399/- cr. to `1,95,808/- cr. Stock futures open interest
against the premium of 75.95 points to its spot. Next month
has decreased from `76,237/- cr. to `70,251/- cr. Liquid
future is trading with premium of 125.25 points. Liquid counters
counters names which added significant positions last week
where CoC is high are GRASIM, HDFCBANK, IDFC,
are ITC, ACC, HDFC, POWERGRID and TATASTEEL. On the
BAJAJ-AUTO and TATAMOTORS. Stocks with negative CoC are
other hand unwinding was visible in counters like LUPIN,
COALINDIA, NTPC, PFC, IFCI and SAIL.
COALINDIA, HEROMOTOCO, BHARTIARTL and
ULTRACEMCO.
Derivative Strategy
Scrip : NIFTY
CMP : 8901.85
Lot Size : 25
Exercise Date (F & O) :
26th. Mar 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
8900
MAR
PE
90.00
8550
`260.00
BEP
-
8810
8650
`160.00
8750
`60.00
Max. Risk: `2,250/-
Max. Profit: Unlimited
If NIFTY closes on or above strike price on expiry.
If NIFTY continues to move below BEP.
8850
(`40.00)
8950
(`90.00)
NOTE: Profit can be booked before expiry if NIFTY moves in favorable direction and time value decays.
9050
(`90.00)
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