For Private Circulation Only

Technical and Derivatives Review

| August 13, 2021

Heavyweights join the party, sends Nifty beyond 16500

Sensex (55437) / Nifty (16529)

Source: Trading View

Future outlook

The August month started with a bang last week as we not only managed to reach the much awaited milestone of 16000 but also

moved beyond it convincingly. This was followed by a quiet start this week. In fact, during the first three trading sessions, our

markets consolidated with some hint of profit booking at higher levels. Fortunately, the mighty bulls provided cushion at the lower

range of 16200 – 16170 for the Nifty. On the weekly expiry day, we had a gradual up move to register new all-time high at 16375

which was then followed by a spectacular move in few heavyweights to reach the new milestone of 16500 to conclude the week on

a cheerful note.

Market looked a bit tentative in the first half this week, especially the broader market as we witnessed a healthy correction in NIFTY

MIDCAP 50 index. At one point, it was on the cusp of violating recent swing lows but fortunately it got its mojo back slightly and

managed to recover fair bit of ground towards the end. Going ahead, things are going to get tougher because from hereon we are

likely to see lot sector churning every now and then. Nifty has reached 16500 without the participation of banking space, which is

hard to believe. So it would be interesting to see how things pan out going ahead. Also, it would be unfair to expect the similar pace

from Nifty to reach new millstones. Since there is no sign of weakness, we are not advising to go against the trend but we reiterate

when things start to look hunky dory everywhere, wise traders choose to take some money off the table. We second this as we

advise continuing with one step at a time approach and keep booking timely profits in the rally.

As far as levels are concerned, the sacrosanct support is placed at 16200 – 16170 before which 16400 – 16300 are to be considered

as immediate levels. On the upside, it’s hard to project any level as we have entered an uncharted territory. Still, every 100 points

rally from hereon should be treated as the upside range.

For Private Circulation Only

Technical and Derivatives Review

| August 13, 2021

Nifty adds more longs, but PCR reaches overbought zone

Nifty spot closed at 16529.10 this week, against a close of 16238.20 last week. The Put-Call Ratio has increased from 1.40 to 1.73.

The annualized Cost of Carry is negative at 2%. The Open Interest of Nifty Futures increased by 14.19%.

Derivatives View

Nifty current month future closed with a discount of 11.10 points against a premium of 13.50 points to its spot. Next month future is

trading at a premium of 22.85 points.

In options segment, we saw some open interest build up in 16500 and above call options, while good amount of put writing was

seen in 16200-16400 strikes. Highest open interest for coming weekly series is placed at 16800 call and 16400 put options.

We witnessed some rangebound action in Nifty for most part of the week. However, declines towards 16200-16170 witnessed good

buying interest and the index rallied smartly on Friday to end the week well above 16500. Nifty continued to attract fresh longs and

added open interest of 14 percent which led to the index marking new records. On net basis, FII’s formed marginal longs in the index

futures segment and their ‘Long Short Ratio’ currently stands above 67 percent. As per options data, the support base has now

shifted to 16400 for coming week, while 16600 and 16800 would be levels to watch out for on the higher side. Also we would like to

highlight that though the above given data is positive, the PCR has reached 1.73 which is usually considered as overbought situation

and the Nifty futures have ended in discount to the spot. Hence, one should trade selectively and also look to book timely profits in

the upmove.

Weekly change in OI

Short Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

LUPIN 11834550 99.56 976.40 (15.35)

EICHERMOT

3998050

86.80

2548.30

(6.57)

MANAPPURAM

31092000

69.85

165.25

(20.42)

IDEA

543830000

22.85

6.35

(10.56)

AUROPHARMA

13862550

22.01

761.10

(15.71)

Long Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

BHARATFORG 8974500 31.15 822.00 5.03

POWERGRID

30680749

24.04

183.95

5.08

SIEMENS

2026750

23.55

2243.70

7.49

ESCORTS

5640250

12.69

1275.45

6.21

VEDL

143061900

10.84

329.60

4.44

For Private Circulation Only

Technical and Derivatives Review

| August 13, 2021

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

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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