Technical and Derivatives Weekly Review - March 5, 2023

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Technical and Derivatives Review |March 05, 2023

Strong recovery in Nifty, led by the rally in Banks

Sensex (59809) / Nifty (17594)

Source: Tradingview.com

Future outlook

Our market started the week on a bleak note taking cues from the weak global bourses, wherein the benchmark index tested the

Budget day’s swing low and dented market sentiments. Nifty struggled near the 200 SMA throughout the week until the last session,

when a robust recovery was seen in the broader market space. Eventually, the week closed on a positive note, procuring 0.74

percent from its previous week’s closure and Nifty settled a tad below the 17600 level.

The upsurge in the Adani group companies post the block deal has its rub of effect on the PSU Banks, eventually spreading the cheer

in the broader market. From a technical perspective, the recent price action could be seen as constructive development for our

markets as the index witnessed a modest recovery from the 200 SMA and made a strong closure on the daily time frame. As far as

levels are concerned, 17500 is now likely to be seen as the immediate support zone, while the sacrosanct support lies around the

17350-17400 zone, coinciding with the 200 SMA. On the flip side, the bearish gap of 17770-17800 is expected to act as the sturdy

hurdle for Nifty in a comparable period.

Going forward, we remain sanguine and would advise the traders to utilize the dips to add long position in the index. The

participation from the high-beta Banking space has provided the much needed impetus and is likely to continue in the near term.

Simultaneously, one should also keep a close tab on the Mid-cap space, which is expected to provide immense trading opportunities

in the near period.

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Technical and Derivatives Review |March 05, 2023

Sho

rt Form

ion

Short rollover for key indices

Nifty spot closed at 17594.35 this week, against a close of 17465.80 last week. The Put-Call Ratio has decreased from 0.878 to 1.17

on Weekly basis. The annualized Cost of Carry is positive at 6.16%. The Open Interest of Nifty Futures increased by 7.14 %.

Derivatives View

Nifty current month’s future closed with a premium of 77.20 against a premium of 90.45 points to its spot in the previous week.

Next month’s future is trading at a premium of 175.95 points.

After recent sell-off finally we saw a sharp rally on Friday to conclude the week around 17600 mark. During the selling, we witnessed

decent amount of shorts in key indices but on the final day of the week short covering was seen in Nifty and banking index added

fresh longs. In options front, put writers added huge positions in 17400-17600 strikes, suggesting strong base formation around

17400-17500 now. On the other side, 17700-17900 call strikes added some fresh bets. Stronger hands have covered shorts, led

‘Long Short Ratio’ to surge to 23% from 18% WoW. The above data points hints, market has certainly bottom out and we may see

extension of upmove in the festive week.

Scrip

Futures

Chg (%)

Price

Chg(%)

TATASTEEL 235460500 33.26 107.75 (2.36)

MPHASIS 2090000 29.91 2083.85 (5.50)

PEL 7553150 28.86 787.70 (1.54)

VEDL 39914000 24.46 291.10 (1.59)

HDFCAMC 3018600 19.70 1806.80 (1.25)

Weekly change in OI

Long Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

ADANIENT 16582250 20.23 1891.20 43.43

INDIAMART 318600 18.86 4894.00 4.74

TORNTPOWER 3687000 17.83 514.35 2.76

ABCAPITAL 34975800 15.31 155.70 9.00

ABB 1630750 15.25 3330.90 5.55

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Technical and Derivatives Review |March 05, 2023

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

Sneha Seth Senior Analyst – Technical & Derivatives sneha.seth@angelone.in

Rajesh Bhosale Technical Analyst rajesh.bhosle@angelone.in

Osho Krishan Senior Analyst – Technical & Derivatives osho.krishan@angelone.in

Research Team Tel: 022 - 39357600 Website: www.angelone.in

For Technical Queries E-mail: technicalresearch-cso@angelone.in

For Derivative Queries E-mail: derivatives.desk@angelone.in

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Technical and Derivatives Review |March 05, 2023

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