For Private Circulation Only

Technical and Derivatives Review

| August 06, 2021

16000 finally becomes the reality

Sensex (54278) / Nifty (16238)

Source: Trading View

Future outlook

Two months’ of boredom finally came to an end as market kick started the August month with a bang. There were several attempts

made recently to reach the millstone of 16000 but every time global markets became a spoil sport. This time it was certainly not the

case. We had complete support from the global peers which provided impetus to reach the magical figure of 16000. The moment we

surpassed and sustained above it, there was no looking back. Barring Friday’s muted session; the Nifty had an excellent week to add

more than 3% to the bulls’ kitty to hasten towards the 16300 mark.

During the previous week, the Nifty had a smart recovery from the lower range; but banking index kept sulking throughout. As

everyone knew, if Nifty had to reach new highs, it wouldn’t have been possible without the contribution of this heavyweight space.

Fortunately it didn’t disappoint this time; courtesy to initial charge from the ICICI Bank and then it was all SBI and HDFC Bank’s show

to reach the higher boundary of BANKNIFTY around 36000 – 36200. This space cooled off marginally towards the fag end, but

despite this, all eyes on this high beta index; because any sustainable move beyond 36200 would result in an extension of its rally

towards its record high. This will certainly bode well for the bulls as we may then see Nifty reaching or even moving beyond the next

milestones of 16400 – 16500.

Although, the upward trend has just resumed after a long consolidation, we would advise short term traders to start lightening up

positions if Nifty reaches the mentioned levels in coming days. Because prices have now started moving far away from some key

moving averages on the Quarterly time frame charts. We are not at all advising to go against the current trend; but at least taking

some money off the table on existing positions is always a good ploy. As far as supports are concerned, 16200 followed by 16000 are

likely to be considered as key levels for the benchmark; whereas for BANKNIFTY, the similar zone is visible around 35500 – 35200.

The momentum traders are advised to take one step at a time and follow a proper risk management.

For Private Circulation Only

Technical and Derivatives Review

| August 06, 2021

Nifty open interest surged 33%, majority longs

Nifty spot closed at 16238.20 this week, against a close of 15689.80 last week. The Put-Call Ratio has increased from 1.09 to 1.40.

The annualized Cost of Carry is positive at 1.52%. The Open Interest of Nifty Futures increased by 32.94%.

Derivatives View

Nifty current month future closed with a premium of 13.50 points against a premium of 32.65 points to its spot. Next month future

is trading at a premium of 56.00 points.

Post last two months’ of boredom, we kick started the August month with an upside gap of over 100 points but in absence of follow-

up buying, closed around the opening levels. On the subsequent day, we had a good bump up at the opening and within few

minutes, the Nifty hastened towards its much awaited milestone of 16000. Then we witnessed sharp follow-up buying for next three

sessions to almost touch 16350 mark on Thursday. However, some profit-booking was observed as Nifty approached 16300-16350

zone, which resulted the weekly closing with the handsome gains of 3%. Now let’s take a look on F&O action for the week, we saw

open interest addition of nearly 33% in Nifty and considering the price action it clearly hints strong buying during the week. The

banking index mainly rallied due to short covering. In options front, we saw smart writing in puts till Wednesday but next two

sessions call writers took the charge by shorting 16300-16400 strikes. We also witnessed put writers of 16300 exiting their positions

on Friday. At current juncture, 16100-16200 is the immediate demand zone; whereas, resistance is placed around 16400-16500 now

Weekly change in OI

Short Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

COFORGE 1309200 149.37 4772.70 (5.61)

RBLBAN

44314900

46.37

178.80

(7.69)

DABUR

13922500

40.70

586.00

(2.92)

EXIDEIND

22550400

40.17

172.70

(3.17)

COLPAL

2777600

32.35

1649.40

(3.28)

Long Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

SBILIFE 9072000 105.71 1150.65 4.24

CUMMINSIND

3169200

36.42

904.70

6.83

TATAPOWER

150754500

22.09

135.70

8.21

TATACHEM

11060000

20.99

827.20

7.76

BANDHANBNK

27181800

18.20

304.10

3.98

For Private Circulation Only

Technical and Derivatives Review

| August 06, 2021

Research Team Tel: 022 - 39357600 (Extn – 6844) Website: www.angelbroking.com

For Technical Queries E-mail: technicalresearch-cso@angelbroking.com

For Derivative Queries E-mail: [email protected]

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Technical and Derivatives Team:

Sameet Chavan Chief Analyst – Technical & Derivatives sameet.chavan@angelbroking.com

Ruchit Jain Senior Analyst - Technical & Derivatives ruchit.jain@angelbroking.com

Rajesh Bhosale Technical Analyst rajesh.bhosle@angelbroking.com

Sneha Seth Derivatives Analyst sneha.seth@angelbroking.com