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Technical and Derivatives Review

| June 25, 2021

Nifty eyeing 16000 this time, banking becomes the catalyst

Sensex (52925) / Nifty (15860)

Source: Trading View

Future outlook

The massive correction in US markets last Friday had a continuation on Monday morning to haunt traders across the globe. As a

result, our markets opened with more than a percent cut to test the 15500 mark. However this was followed by a remarkable v-

shaped recovery in the remaining part of the day. For the subsequent two sessions, markets consolidated at higher levels with no

clear intent. However, towards the fag end of the week the bulls were back with some strength to mark highest ever weekly close

tad below 15900.

In our previous weekly commentary, we had advocated some caution considering the formation of ‘Hanging Man’ pattern on weekly

chart. To activate this, the prices should have slipped below the low i.e. 15450 in this case. But since it reversed from 15500, the

pattern was not confirmed. Also, we had shared our observation on the placement of the NIFTY MIDCAP 50 index around some

crucial levels. All these negative developments have not been completely negated yet; but the kind of up move we witnessed in

BANKNIFTY on Friday’s session, the bulls seem to have upper hand here. Hence, banking becomes a deciding factor going ahead. A

follow up move in the coming sessions would definitely push the Nifty towards its much awaited milestone of 16000 and may even

extend towards 16200 later. Hence, it would be interesting to see how things pan out in the banking space.

As far as supports are concerned, the immediate levels are placed at 15700 – 15670 and the base is to be seen at 15450 now. Till the

time market defends these important supports, the short term trend remains bullish. But having said that we would still reiterate

that one should avoid being complacent and it’s better to continue with the strategy of ‘one step at a time’. Because although it’s

difficult to time it, whenever any rally overstretches without giving any meaningful correction, market tends to surprise anytime. So

to be on the safer side, try to avoid aggressive leveraged positions overnight.

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Technical and Derivatives Review

| June 25, 2021

Banking index finally regained strength; expect short covering

Nifty spot closed at 15860.35 this week, against a close of 15683.35 last week. The Put-Call Ratio has increased from 1.18 to 1.20.

The annualized Cost of Carry is positive at 1.93%. The Open Interest of Nifty Futures decreased by 6.39%.

Derivatives View

Nifty current month future closed with a premium of 27.65 points against a premium of 96.65 points to its spot. Next month future

is trading at a premium of 75.65 points.

In options segment, being start of new series build-up looked quite scattered between 16000-16500 call and 15500-15800 put

options. Highest open interest for coming weekly series is placed at 16000 call and 15700 put options.

Post last Friday’s smart recovery, we began Monday’s session’s with downside gap but smart recovery was seen to reclaim 15750

mark on the same day. In next session, we saw extension of up move towards 15850-15900 but failed to sustain at higher levels and

then as we progressed index traded in the range of 250 points. On Friday, once again index inched higher to conclude the week tad

above 15850 mark. In June series, we did not see any addition of positions in Nifty but some shorts were formed in the banking

index which led to its underperformance. Now the rollover Nifty is around 85% versus its 3-month average of 76% while that in Bank

Nifty is around 84% versus its average of 76%. FII's formed mixed positions during the series but their 'Long Short Ratio' at the start

of new series is at 82%. At this point in time, the immediate supports for Nifty are placed around 15700 and 15600 mark while

resistance is seen around 15900-16000.

Weekly change in OI

Short Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

RELIANCE 43504250 21.40 2117.90 (4.85)

BOSCHLTD

125550

16.74

15014.45

(1.45)

GODREJCP

3808000

11.51

875.90

(2.13

)

APOLLOTYRE

15670000

9.50

219.20

(3.48)

UPL

21399300

7.75

802.35

(1.02)

Long Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

ICICIPRULI 5151000 24.60 617.35 6.10

APOLLOHOSP

2070250

19.37

3449.90

6.88

PNB

333584000

10.06

2.60

5.97

JSWSTEEL

39532050

8.31

687.25

2.19

SBILIFE

6231000

7.09

1012.40

2.99

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Technical and Derivatives Review

| June 25, 2021

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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