For Private Circulation Only
Technical and Derivatives Review
| August 29, 2020
Banking single handedly drives Nifty towards 11700
Sensex (39467) / Nifty (11648)
Source: Trading View
Future outlook
We started off proceedings for the week on a positive note, owing to favourable global cues. During the remaining part of the
week, we witnessed a steady move in benchmark as there was lot of sectoral churn was being witnessed. In the process, Nifty
gradually marched towards the 11700 mark, marking highest close after February 26, 2020.
The ongoing rally across the globe is just extraordinary and we are not at all falling behind. Although we are not actively
participating in index specific trades since last a week (After 11350-11400) or so, the focus remained on individual stocks. Yes
but at the same time, we are advocating booking timely profits on trades as well and we would continue to do so. After a
certain time, it’s always better to let go some move and focus on money management. As far as levels are concerned, 11700-
11750 remains to be an immediate hurdle (coincides with multi-month upward sloping trend line); whereas on the flipside,
11600 followed by 11540 would be seen as key support levels. It may sound a bit repetitive but since we have approached yet
another cluster of resistance, we continue to advise some caution at higher levels, rather better to take one step at a time and
keep a close eye on key levels. It is also important to take a note that the short term pause would be seen below 11540-
Since last few days, the banking space started to outperform and during the week, although there was a gradual move seen in
Nifty, the banking index seems to have taken a giant leap of 10%. Apart from this, there was a decent stock specific action
seen throughout the week, but we could see some sectoral shift during the latter half. Hence, one needs to be selective when
it comes to stock picking going forward.
For Private Circulation Only
Technical and Derivatives Review
| August 29, 2020
FII’s carry long positions in index
Nifty spot closed at 11647.60 this week, against a close of 11371.60 last week. The Put-Call Ratio has increased from 1.54 to 1.64.
The annualized Cost of Carry is positive at 3.21%. The Open Interest of Nifty Futures has increased by 7.21%.
Derivatives View
Nifty current month future closed with a premium of 27.65 points against a premium of 17.60 points to its spot. Next month future
is trading at a premium of 41.45 points.
As far as Nifty options activities are concerned, 11600 and 12000 call options added some open interest whereas 11600-11300 put
options witnessed open interest addition. Maximum open interest for the weekly series is at 12000 call and 11500 put option.
Nifty rallied higher during the monthly expiry week due to formation of fresh long positions. Bank Nifty outperformed the
benchmark and gained about 10 percent during the week. The rollover in Nifty is at 79.82 percent versus its average of 78.82
percent whereas rollover in Bank Nifty is at 77.91 percent which is also in line with its average. FII’s formed long positions in the
index futures segment and they have rolled their long positions to the September series. Their ‘Long Short Ratio’ is now above 77
percent which is a good sign. The weekly options data hints support at 11600 and 11500 for the near term. Traders are advised to
trade with a positive bias and look for stock/sector specific buying opportunities from a near term perspective. If the index breaks
the 11500 mark, then one should reassess the data and trade accordingly.
Weekly change in OI
Short Formation
Chg (%)
JINDALSTEL 21690000 20.94 217.50 (3.35)
Long Formation
Chg (%)
BANKBARODA 72463400 56.80 51.85 6.47
For Private Circulation Only
Technical and Derivatives Review
| August 29, 2020
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Technical and Der
ivatives Team:
Sameet Chavan Chief Analyst – Technical & Derivatives sameet.cha[email protected]g.com
Ruchit Jain Senior Analyst - Technical & Derivatives ruchit.jai[email protected].com
Rajesh Bhosale Technical Analyst rajesh.bhosl[email protected]ng.com
Sneha Seth Derivatives Analyst [email protected]gelbroking.com