For Private Circulation Only

Technical and Derivatives Review | November 03, 2021

Nifty ends the truncated week around 17800

Sensex (59772) / Nifty (17829)

Source: Tradingview.com

Future outlook

We inaugurated the festive week on a cheerful note on Monday and witnessed some hiccups in the initial two hours of trade. As we

progressed, the buying interest emerged to slowly and steadily move beyond 17950. On the following day, we again started

positively but failed to sustain at higher levels after retesting the psychological barrier of 18000. After undergoing a small correction

on Tuesday, the subsequent session started positively and Nifty made one more attempt towards 18000. Once again we witnessed

some nervousness at higher levels as the selling augmented in the latter half to pull the Nifty back to 17800.

Since it was a truncated week on the back of Diwali festival, markets remained more or less in a range of merely 300 points, where

both the support and resistance range played out accurately. Historically it’s observed that market do not correct during the Diwali

week and this is what we witnessed in last three sessions. But we must accept the fact; markets were a bit tentative in last couple of

sessions. Since there was no major action in the week gone by, our overall view remains the same as we had mentioned in our

previous commentary. We continue to remain cautious on the market because of few technical developments, they are as follows:

1) the ‘Lower Top Lower Bottom’ on daily chart got confirmed last Friday after breaking below 18000. 2) this coincided with the

violation of the key short term moving average of ’20-day EMA’, which is now acting as a sturdy wall. 3) More importantly, if we take

a glance at the monthly chart, we can see a formation of ‘Shooting Star’ pattern, which certainly does not bode well for the bulls.

Traders are advised not to carry aggressively bets on the long side as long as we remain below 18000 – 18100 on a closing basis. On

the flipside, we may see this corrective move extending towards 17450 first and if things worsened then the possibility of sliding

towards 17200 – 17000 cannot be ruled out. The coming week would be quite crucial for the market as it may dictate the near term

direction.

For Private Circulation Only

Technical and Derivatives Review | November 03, 2021

No meaningful change in F&O space

Nifty spot closed at 17829.20 this week, against a close of 17671.65 last week. The Put-Call Ratio has increased from 0.75 to 0.81.

The annualized Cost of Carry is positive at 1.69%. The Open Interest of Nifty Futures decreased by 3.06%.

Derivatives View

Nifty current month future closed with a premium of 17.95 points against a premium of 43.65 points to its spot. Next month future

is trading at a premium of 80.45 points.

It was a truncated festive week with no major price action and open interest activities. The benchmark index grinded in the range of

merely 300 points to concluded ninth tenth per cent higher to previous week’s close. In F&O space, we saw some open interest

reduction in Nifty; whereas, no relevant change was observed in banking index. 18000 call options added good amount of build-up;

suggesting market may face strong hurdle around this zone. On the other side, some build-up was seen in 17800 strike. Throughout

the week, we hardly saw any relevant development in derivatives segment hence, we would stick to the view of staying light in index

and opt for stock specific trades

Scrip

Futures

Chg (%)

Price

Chg(%)

M&M 10761100 38.70 852.70 (3.83)

IRCTC 14476375 23.56 822.25 (3.22)

MARICO 7229000 20.93 552.50 (2.43)

PIIND 1504000 19.03 2733.60 (9.08)

ESCORTS 9710800 14.76 1506.30 (4.54)

Weekly change in OI

Long Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

ABFRL 11809200 27.44 286.15 8.72

SBIN 120505500 21.51 530.30 5.05

INDIAMART 264450 20.46 7356.15 2.86

IBULHSGFIN 31334800 20.12 226.20 3.93

TRENT 2348275 17.87 1097.40 8.82

Short Formation

For Private Circulation Only

Technical and Derivatives Review | November 03, 2021

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Technical and Derivatives Team:

Sameet Chavan Chief Analyst – Technical & Derivatives sameet.chavan@angelone.in

Rajesh Bhosale Technical Analyst rajesh.bhosle@angelone.in

Sneha Seth Derivatives Analyst sneha.seth@angelone.in