Technical and Derivatives Weekly Review - January 14, 2023

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Technical and Derivatives Review |January 14, 2023

17750 Once again proved its significance

Sensex (60261) / Nifty (17957)

Source: Tradingview.com

Future outlook

Our markets had a splendid start for the week owing to favorable developments in US markets over the weekend. At the close, Nifty

did not disappoint as it reclaimed 18100 on a closing basis. Honestly, we expected the market to come out of its recent slumber

phase; but once again, markets failed to sustain at higher levels. The nervousness creeped up as the week progressed and, in the

process, we gradually sneaked below the 18000 mark in fact, in last couple of sessions, we did challenge recent swing low of 17774.

Fortunately, the heavyweights came for a rescue at lower levels, resulting in a smart recovery to reclaim 17950 on a closing basis.

It was indeed a challenging week for the market participants as the trending moves were clearly missing. Nifty remained in a range

and whenever it seemed a trend has established, the market would reverse in the opposite direction. We, however, remained glued

to our stance and instead of swaying with the market moves we considered buying on the lower side of the range. On the weekly

chart, we can see a ‘DOJI’ pattern that indicates uncertainty, and it seems market participants are waiting for some trigger for the

next directional move. In our sense, the December month swing low around 17750 is acting as a fortress for the bulls and as long it

holds; one should continue with the buy-on-dip approach. On the flip side, as the trading range is getting coiled, the resistance levels

are shifting lower. On the hourly chart, we can see a trend line resistance around the 18000 – 18050 levels, and prices have ended

just below the same. Going ahead a sustained trade beyond the same can trigger positive momentum in the coming week. The stiff

hurdle remains around 18300 which once broken can resume the primary uptrend.

During the week, even though the benchmark was trapped in a range there were some pockets that showed strength and going

ahead as well we advise traders to continue with the stock-centric approach as the individual themes may play out well ahead of

budget.

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Technical and Derivatives Review |January 14, 2023

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Market remains indecisive, amidst the mixed F&O data

Nifty spot closed at 17956.60 this week, against a close of 17859.45 last week. The Put-Call Ratio has increased from 0.75 to 1.03 on

Weekly basis. The annualized Cost of Carry is positive at 11.63%. The Open Interest of Nifty Futures increased by 5.48%.

Derivatives View

Nifty current month’s future closed with a premium of 68.65 against a premium of 83.75 points to its spot in the previous week.

Next month’s future is trading at a premium of 141 points.

Our market witnessed a slender range-bound movement throughout the week, wherein the benchmark index kept hustling near the

crucial support of the 17800-17750 odd zone for most of the trading sessions. In the F&O space, we observed mixed bets throughout

the week, starting from short addition to covering. Amidst the hustle, the key indices concluded the week on a mere but positive

note. The stronger hands continued their relentless selling spree in cash segments, but by the weekend, they curtailed shorts from

the index futures resulting in a surge of the ‘Long Short Ratio’, which improved slightly to 43% from 41% on a weekly basis. However,

the weekly closure construes indecisiveness in the market and till the trend does not get clear, we advocate to avoid aggressive bets

and focus on a stock-specific approach.

Scrip

Futures

Chg (%)

Price

Chg(%)

LTTS 1705600 53.24 3385.75 (5.77)

GUJGASLTD 6072500 34.24 449.60 (6.95)

DIXON 569875 23.32 3645.00 (4.60)

CUB 11580000 19.01 165.85 (5.50)

BHARTIARTL 46719100 16.67 767.85 (4.01)

Weekly change in OI

Long Formation

Scrip

Futures

Chg (%)

Price

Chg(%)

TATACOMM 2577000 27.01 1383.30 3.93

HINDCOPPER 23745600 20.22 127.20 9.28

PERSISTENT 577325 18.20 3991.30 4.18

RAIN 12677000 16.61 184.50 5.91

L&TFH 72882308 15.79 92.95 6.53

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Technical and Derivatives Review |January 14, 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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