WHAT LIES AHEAD : NEAR-TERM PIC­TURE

Flash News Investment - - TECHNICALS -

SPOT NIFTY : In­dian eq­uity bench­marks greeted the new year 2019 on an op­ti­mistic note with the Nifty re­claim­ing its im­por­tant psy­cho­log­i­cal level of 10,900. How­ever, the cel­e­bra­tion for the bulls was short-lived as the mar­kets fell like a pack of cards in the fol­low­ing ses­sions, i.e. Wed­nes­day and Thurs­day ses­sion as neg­a­tive global cues came to haunt the mar­kets. The dose of dis­ap­point­ing man­u­fac­tur­ing data from China and Euro­zone ap­peared to keep the con­cerns on slow­down in global growth in­tact. Also, some dis­ap­point­ment from the GST col­lec­tion for the month of De­cem­ber and the core sec­tor growth for the month of Novem­ber 2018 that came in at 16-month low of 3.5 per cent added to the woes. On the sec­toral front, auto stocks came un­der ham­mer­ing as the auto in­dex plunged about 5 per cent.

Nifty, af­ter reg­is­ter­ing a low of 10534.55, en­tered into an up­move and reg­is­tered gains for five days in a row. How­ever, af­ter flirt­ing around the 100-day mov­ing av­er­age for a cou­ple of days, Nifty once again wit­nessed a sharp sell-off from the 100day mov­ing av­er­age and, on the down­side, it breached its cru­cial long term av­er­age, i.e. 200-day mov­ing av­er­age. Go­ing ahead, Nifty is now crit­i­cally placed on the charts as it is near to the ris­ing trend­line sup­port formed by con­nect­ing lows of De­cem­ber 11 and 26, 2018. In the com­ing ses­sion, hold­ing above the 10,660-10,650 lev­els would keep the pull­back op­tions open. How­ever, fail­ure to do so would re­sult in con­tin­u­ance of the lack­lus­tre move amid stock-spe­cific ac­tion as we are about to en­ter the Q3 FY19 earn­ings sea­son. The zone of 10,660-10,650 is likely to act as im­me­di­ate sup­port level, fol­lowed by 10,534.

On the up­side, 10,785 is likely to act as im­me­di­ate re­sis­tance, as the 200-day mov­ing av­er­age is placed around this level.

NIFTY DERIVA­TIVES: The In­dian Volatil­ity In­dex (VIX), a gauge for the mar­ket’s short term ex­pec­ta­tion of volatil­ity, surged by 2.44 per cent to end at 16.79. Nifty Jan­uary 2019 fu­ture last price stood at 10,715.55 at a pre­mium of 43.30 points over the spot clos­ing of 10,672.25. Nifty Fe­bru­ary 2019 fu­ture last price stood at 10745.05 at a pre­mium of 72.80 points over the spot clos­ing of 10,672.25. The Nifty Put-Call Ra­tio (PCR) Open In­ter­est-wise stood at 1.07 for the Jan­uary month con­tract. Among Nifty Calls, 11,000 strike price from the Jan­uary month ex­piry was the most ac­tive Call. Among Nifty Puts, 10,500 strike price for the Jan­uary month ex­piry was the most ac­tive Put. For the Jan­uary se­ries, the max­i­mum OI out­stand­ing for Puts was at 10,500 strike price, and that for Calls, it was at 11,000 strike price.

NIFTY

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