Nifty Derivative Snapshot & Derivative Stock Recommendations

CNX NIFTY (8131) opened positive but continued its selling pressure for 3rd consecutive trading session and fell down towards 8050 levels. It was under the bear grip for first half of the session as it corrected by more than 100 points, but post lunch it managed to place an immediate bottom and recovered sharply towards 8140 zones. Finally index closed negative with the loss of 4 points but made a “Hammer” candle on daily chart and giving a first sign of immediate reversal pattern if follow up continues. Now, it has to hold above 8150-8160 zones to witness a bounce back rally towards 8220-8230 zones, while if it fails to hold 8080 then weakness may continue towards 8050 and 8000 levels.

On Thursday, initial narrow range consolidation failed to save index from slipping to 8,057 mark (i.e. from 8,160 level) during the day, but finally, ended the session with minor loss amidst late trade corresponding bounce back.

• CNX NIFTY closed the day with loss of 4 points at 8,131 level.
• NSE Cash segment witnessed turnover of about Rs15,659 crores as compared to Rs18,913 crores earlier.
• Overall market breadth remained negative, where 693 stocks advanced against 763 declined stocks.
• Mixed trend was witnessed amongst sectoral indices during the day, where CNX MEDIA & CNX REALTY emerged as top gainers with the increase of 1.1% & 0.9% respectively, however CNX METAL & CNX PHARMA emerged as top losers with the decrease of 1.3%-1%.

CNX NIFTY OUTLOOK

• CNX NIFTY witnessed decent rebound after slipping to four week low. As mentioned earlier, minor bounce back cannot be ruled out post such a massive decline, where obstacles around 8,270-8,300 range will restrict the rise, provided index crosses 8,160 mark. Our near-term technical view will remain negative and we believe any close below 8,000 level will make index vulnerable and find next support around 7,700-7,600 range.
• As for the day, support is placed at 8,050 and then at 8,000 levels, while resistance observed at 8,180 and then at 8,270 levels.
• Nifty opened flat but had a volatile trading session before closing flat.
• Nifty lost 4 points to close at 8130.
• OI concentration is seen at 8000 PE and 8500 CE.
• Activity witnessed in 8300 strike.
• PCR OI stands at 0.92 compared to 0.94 in the previous trading session.
• Nifty to trade with a resistance of 8470.

Stocks

• FMCG and Pharma stocks kept Nifty under pressure.
• In the Oil&Gas space, Reliance has showed strength and has been the lead in Nifty. The stock has made a 'U' shaped recovery in the monthly charts. It trades with a positive bias in the monthly, weekly and daily charts. The RSI also indicates a positive trend. One can buy ATM call options and hold in the same.
• Market wide open interest is seen at Rs.199,906Cr. 
• Amongst sectoral index, CNX Media adds fresh long position.
• HDIL and TATA Power observed build up in short position.
• Based on delivery analysis, distribution was observed in Unitech and DLF.

JSW STEEL is falling down from last 4 trading session and broken its immediate support of 865 levels. It is making lower top - lower bottom formation and adding fresh built up of short position. It if fails to hold 865 zones then more shorts may be seen in the stock to drag it to lower levels. One can sell the stock with stop loss of 905 for the downside target of 853 levels. 

Sell JSW Steel Between Rs. 883 to Rs. 892,Stop Loss 905,Target 853 

RELIANCE is moving after a long consolidation of last six series and set to negate its immediate negative trend by holding above 915 levels. It is making a higher base from last 4-5 weeks and now witnessing short covering activity which may attract bulls to drag it to higher levels. One can buy the stock with stop loss of 890 for the upside target of 942 levels. 

Buy RIL Between Rs. 903 to 912,Stop Loss 890,Target 942