Nifty Derivative Snapshot & Derivative Stock Recommendation

CNX NIFTY begun the session at 8,628 level, but later declined gradually the way session progressed and after visiting 8,553 mark during the day, finally shut the shop with the loss of 64 points at 8,571 level.

• NSE Cash segment witnessed a turnover of about Rs20,171 crores as compared to Rs18,595 crores earlier.
• Overall market breadth remained negative, where 306 stocks advanced against 1215 declined stocks.
• Except CNX IT (rose by 0.7%) negative trend was witnessed amongst all sectoral indices during the day, where CNX REALTY, CNX FMCG & CNX MEDIA emerged as top losers with the decrease of 3.9%-2.1%.
• Nifty lost 63 points to close at 8570.
• OI concentration is seen at 8500 PE and 9000 CE.
• Reduction witnessed in 8800CE and in 8700PE.
• PCR OI stands at 0.86 compared to 0.88 in the previous trading session.
• Nifty to trade with a resistance of 8730

CNX NIFTY OUTLOOK

CNX NIFTY closed on 9-week low with the loss of ~1%. From last two week, index witnessed selling pressure on every rebound and so far reported a fall of ~300 points from the recent peak of 8,850 level. Despite a recent plunge, our near-term technical view remains negative with probable down move towards 8,500 mark, as we believe index will remain in pressure till the time it trades below its 20-days EMA (i.e. placed around 8,700 mark.) In case of further decline support from lower band of the rising channel (i.e. placed around 8,400 mark) will try to limit the loss.

As for the day, support is placed at 8,510 and then at 8,470 levels, while resistance observed at 8,630 and then at 8,700 levels.

Put Call Ratio based on Open Interest of Nifty remained unchanged at 0.87 levels. Historical Volatility of Nifty fell down from 18.17 to 17.72 levels and Implied Volatility also fell down from 16.10 to 14.87 levels.

Stocks 

• Most front line stocks traded in the red as Nifty stooped below 8580 levels. 
• From the IT space, INFY had been trading sideways for the past three trading sessions. The stock has shown some upward movement in the previous trading session. 
• We expect the upmove to continue as the RSI and MACD also support the upmove. The stock trades with a positive bias both the weekly and daily charts. 
• One can trade the same at current levels for a near term target of 2350. 
• Market wide open interest is seen at Rs.249,249cr

Future Short Term Recommendations 

CANBK is continuously falling from last three series and seen aggressive built up of short position. It failed to recover even when RBI cut the repo rate by 25bps and witnessing selling pressure at every small bounce back move.

Weakness may continue in this stock till it remains below 396-397 zones. One can sell with a stop loss of 397 for the down side target of 373 levels. 

Sell Between 387 to 391,Stop Loss 397,Target 373

RELINFRA is continuously trading in the bears and showing the willingness to fall. It failed to recover even when market was trading at lifetime high territory and witnessing built up of short position. 

One can sell with a stop loss of 452 for the down side target of 425 levels. 

Sell Between Rs. 441 to 445,Stop Loss 452,Target 425