Technical Picks | April 30, 2016
7750 now a trend deciding level
Sensex (25607) / Nifty (7850)
The proceedings for the week began on Monday where the
Exhibit 1: Nifty Weekly chart
Nifty traded in a narrow range throughout the session.
Tuesday's session saw the bulls take control right from the
start. The Nifty posted decent gains for the day although it
could not surpass the critical resistance of 8000. While
Wednesday again saw the Nifty confined within a narrow
breath, Thursday’s session fell in line of being a typical F&O
expiry session, where the Nifty nosedived to test the lower
end of the week's trading range, although we would want to
mention that the correction was a surprise to us. Friday's
session was represented by a ‘Doji’ candle on the technical
charts. The Nifty ended the session posting a weekly loss to
0.63%.
Pattern formation:
Source: Company, Angel Research
The ’89-day EMA’ and the ’89-week EMA’ for the
Exhibit 2: Nifty Daily chart
Sensex/Nifty are placed at
25097
/
7645 and
25583 / 7749 levels, respectively.
The ’20-day EMA’ and the ‘20-week EMA’ for the
Sensex/Nifty are placed at
25449
/
7789 and
25173 / 7672 levels, respectively.
Future outlook
The market underwent a rollercoaster ride during the week
with the Nifty gyrating on both sides. With reference to our
previous report, the 8000 mark proved its significance as a
couple of attempts to surpass this hurdle during the midst of
the week got sold into. The Nifty has been trading within a
range of 200 points in the past two consecutive weeks and it
has now reached the lower end of the range. The range of
Source: Company, Angel Research
7800 - 7750 coincides with multiple technical evidences,
A sustainable move below this level could possibly accelerate
namely, the daily ’20 EMA’, ‘Parabolic SAR’ indicator and an
the ongoing downward momentum and the correction could
‘Upward Sloping Trend Line’. Hence, it could be considered
then extend till 7600 - 7516 levels. We suggest one should
as a strong support zone to be relied on. If we go by the
now look for buying opportunities, invariably backing up
‘Trend is your Friend’ assumption, the recent down move
trades with strict stop losses, given that the Nifty has a strong
should be construed as a pull back towards the support
support at 7750.
zone. As long as the Nifty manages to hold these important
supports, the possibility of it surpassing the 8000 mark
increases while the 7750 mark on the downside should be
seen as a trend deciding level in the near term.
For Private Circulation Only
1
Technical Picks | April 30, 2016
Wekly Pivot Levels For Nifty Constituents
SCRIPS
S2
S1
PIVOT
R1
R2
SENSEX
25,034
25,320
25,710
25,997
26,387
NIFTY
7,674
7,762
7,877
7,965
8,080
NIFTY BANK
16,282
16,538
16,784
17,041
17,286
ACC
1,383
1,413
1,436
1,466
1,489
ADANIPORTS
221
229
236
244
251
AMBUJACEM
213
217
223
227
233
ASIANPAINT
834
850
872
889
911
AUROPHARMA
736
748
767
779
798
AXISBANK
445
459
472
486
499
BAJAJ-AUTO
2,392
2,442
2,513
2,562
2,633
BANKBARODA
147
152
158
163
168
BHEL
118
122
127
130
135
BPCL
941
959
977
996
1,013
BHARTIARTL
337
350
368
381
398
INFRATEL
353
364
372
383
392
BOSCH
19,015
19,339
19,870
20,194
20,725
CIPLA
514
526
535
547
556
COALINDIA
278
283
288
293
298
DRREDDY
3,006
3,048
3,108
3,149
3,210
EICHERMOT
19563
19799
20086
20322
20610
GAIL
341
351
364
373
387
GRASIM
3,918
4,002
4,075
4,159
4,232
HCLTECH
676
713
784
822
893
HDFCBANK
1,066
1,099
1,118
1,151
1,170
HDFC
1,041
1,064
1,098
1,122
1,156
HEROMOTOCO
2,753
2,825
2,924
2,997
3,096
HINDALCO
87
92
98
103
109
HINDUNILVR
837
852
875
890
912
ICICIBANK
217
227
241
251
265
IDEA
108
113
121
126
134
INDUSINDBK
946
998
1,026
1,077
1,105
INFY
1,176
1,192
1,217
1,233
1,258
ITC
302
313
324
335
346
KOTAKBANK
654
686
703
734
751
LT
1,220
1,237
1,263
1,280
1,306
LUPIN
1,493
1,550
1,584
1,641
1,675
M&M
1,269
1,300
1,348
1,380
1,428
MARUTI
3,566
3,680
3,807
3,921
4,047
NTPC
132
136
140
144
148
ONGC
203
210
218
225
232
POWERGRID
138
141
143
146
149
RELIANCE
936
960
1,002
1,025
1,068
SBIN
177
183
193
199
209
SUNPHARMA
786
798
810
823
834
TCS
2,354
2,445
2,493
2,584
2,633
TATAMTRDVR
284
291
300
307
317
TATAMOTORS
390
399
412
421
434
TATAPOWER
66
68
70
72
74
TATASTEEL
332
342
352
361
372
TECHM
456
470
480
494
503
ULTRACEMCO
3,035
3,098
3,213
3,276
3,391
WIPRO
539
546
555
562
571
YESBANK
841
892
922
973
1,003
ZEEL
388
401
409
422
430
Technical Research Team
For Private Circulation Only
2
Derivatives Review | April 30, 2016
Nifty may remain volatile, trade light.
Nifty spot closed at 7849.80 this week, against a close of 7899.30 last week. The Put-Call Ratio has decreased from 1.03 to 0.94
levels and the annualized Cost of Carry is positive at 7.75%. The Open Interest of Nifty Futures increased by 6.77%.
Put-Call Ratio Analysis
Implied Volatility Analysis
PCR-OI has decreased from 1.03 to 0.94 levels. Being start
Implied Volatility (IV) for NIFTY has increased from 14.26%
of new series, build-up is quite scattered. In call options,
to 15.03%. Historical volatility (HV) of NIFTY is at 19.72%
7900-8300 strikes were quite active and they also added
and that for BANKNIFTY is at 26.07%. Liquid counters
good amount of OI. While in put options, 7700-7900 strike
having very high HV are HCLTECH, CEATLTD, IDFC,
added huge build-up, decent build-up was also visible in
JUBLFOOD and IBREALEST. Stocks where HV are on lower
7200-7600 put options. Maximum OI in current series is
side are ACC, TATAMTRDVR, ANDHRABANK, IOB and
visible in 8200 call and 7700 put options.
CROMPGREAV.
Open Interest Analysis
Cost-of-Carry Analysis
Total open interest of market has increased from
Nifty current month futures closed at a premium of 45.00
`2,13,851/- cr. to `2,36,619/- cr. Stock futures open
points against a premium of 52.80 points to its spot. Next
interest has increased from `56,977/- cr. to `60,294/- cr.
month future is trading with premium of 57.80 points.
Large cap names which added significant positions last
Liquid counters where CoC is high are NHPC, GMRINFRA,
week are HCLTECH, HDFC, ONGC, SUNPHARMA and
UNITECH, ICIL and INDIACEM. Stocks with negative CoC
RELIANCE. On the other hand unwinding was visible in
are JUSTDIAL, IDEA, CEATLTD, IOB and PCJEWELLER.
counters like BANKBARODA, LUPIN, BHEL, CIPLA and PNB.
Derivative Strategy
Scrip: NIFTY
CMP : ` 7849.80/-
Lot Size : 75
Exercise Date (F & O) :
26th May 2016
View : Volatile
Strategy: Long Strangle.
Expected Payoff
Buy/Sell
Qty
Scrip
Strike
Series
Option
Buy/Sell Rate
Closing Price
Expected
Price
Type
(`)
(`)
Profit/Loss
BUY
75
NIFTY
8000
MAY
CE
75.00
7350
`215.00
BUY
75
NIFTY
7700
MAY
PE
60.00
7550
`15.00
LBEP - 7565
UBEP- 8135
7750
(`135.00)
Max. Risk: `10,125/-
Max. Profit: Unlimited
7950
(`135.00)
If NIFTY closes between two strike prices on expiry
If NIFTY closes above UBEP or below LBEP on
expiry.
8150
`15.00
NOTE: Profit can be booked before expiry if Nifty moves in favourable direction.
8350
`215.00
For Private Circulation Only
3
Research Team Tel: 022 - 39357800
E-mail: [email protected]
Website: www.angelbroking.com
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