Update on Nifty levels, Bank Nifty levels, Derivative Outlook and Equity Pick of the day 19th Jan 2018
Nifty 10817 /Sensex 35260/ Bank Nifty 26537
19 Advances / 31 Declines/ 0 Unchanged
Benchmarks end at fresh closing highs; Sensex conquers 35,200 mark
Extending their previous session’s jubilation, Indian equity benchmarks traded with traction through the session and settled at all-time closing high levels. Profit booking in last leg of trade took markets off day’s high, but key gauges managed to end the session above their crucial 35,200 (Sensex) and 10,800 (Nifty) levels. Domestic bourses started the session with a huge gap on the up side, as traders took some encouragement with report that direct tax collections during the first nine-and-a-half months of the current fiscal have risen by 18.7 per cent to Rs 6.89 lakh crore. CBDT said that the collections till January 15, 2018 represent over 70 per cent of the Rs 9.8 lakh crore revenue target from direct taxes. Sentiments also got some support with Commerce and Industries Minister Suresh Prabhu expressing optimism that Indian economy is likely to grow to $5 trillion over the next eight to nine years, backed by government’s focus on bridging digital divide which is also helping people scale up their income.
Market participants continued to take some support from report that the government has reduced the additional borrowing requirement to Rs 20,000 crore for the financial year 2017-18. Prior to this, an additional loan of Rs 50,000 crore was estimated to be borrowed. However, traders booked some of their profit at higher levels in last leg of trade after the World Economic Forum (WEF) said in its annual Global Risks Report that the world will see risks related to environment, economy and international relations intensify this year with a majority of stakeholders expecting political or economic confrontations between major powers to worsen. Traders also remained watchful ahead of GST Council meet scheduled for the day which will consider a host of proposals to simplify procedure for filing of returns, registration of large entities and take stock of the GSTN’s readiness for e-way bill rollout from February 1. The GST Council is expected to consider a reduction in tax rates for some items, about 80 going by some reports, and the inclusion of real estate in its 24th meeting. But, markets get strong support near 35,200 (Sensex) and 10,800 (Nifty) levels and managed to end comfortably above those levels.
Positive opening in European counters too aided sentiments, following dovish comments by European Central Bank policymaker Ewald Nowotny who said that he did not rule out that monetary policy would still continue to be very accommodating for a long time. Asian stocks exhibited mixed trend, as traders remained on sidelines ahead of Chinese GDP data for direction.
Back home, banking stocks remained on buyers’ radar amid report that the government is considering a proposal to permit 100 percent FDI in private banks. However, telecom stocks remained under pressure despite report that industry saw a paltry 0.14 million net addition of subscribers during December, the lowest by the industry in the 2017 calendar year. Aviation stocks closed in red amid CRISIL’s Research report stating that rising crude, congestion are likely to cap domestic airline passenger traffic growth. The rating agency noted that domestic passenger traffic to grow 17-19% in fiscal 2018 compared with 22% in fiscal 2017, on account of rise in fares and airport congestion. In fiscal 2019, rating agency expects growth to moderate further to 15-17%, as fares are expected to feel the heat of higher crude oil prices.
FII’s Activity 18th -Jan-18
The FIIs as per Thursday’s data were net buyers in equity segment, while they were net sellers in debt segment, according to data released by the NSDL.
In equity segment, the gross buying was of Rs 7934.70 crore against gross selling of Rs 7125.75 crore. Thus, FIIs stood as net buyers of Rs 808.95 crore in equities.
In the debt segment, the gross purchase was of Rs 2373.76 crore with gross sales of Rs 2662.14 crore. Thus, FIIs stood as net sellers of Rs 288.38 crore in debt.
In the hybrid segment, the gross buying was of Rs 150.26 crore against gross selling of Rs 152.13 crore. Thus, FIIs stood as net sellers of Rs 1.87 crore in hybrid segment.
Now what to expect ??
Nifty Levels
As we clearly indicated Nifty looks bullish above 10816 level then made high of 10873 but unable to sustain at upper level and crash again.
Now what to expect???
Support at 10750 and Resistance at 10880
Above 10880 will see rally till 10950---11100 mark else could touch its support level of 10750.
Trade with levels only
Bank Nifty
As we clearly indicated Bank nifty looks bullish above 26315 level then made high of 26767 and hit our all the levels.
Now what to expect???
Support at 26200 and Resistance at 26770
Above 26770 will see rally till 26830---26900 mark else could touch its support level of 26200.
Daily Derivative Outlook 19th January 2018
•Nifty (January) futures closed at a discount of 6.20 points versus a premium of 3.25 points.
• MINDTREE (33%), INFRATEL (12%), VOLTAS (12%), HDFC (10%) and DCBBANK (9%) were the top gainers in terms of open interest.
• • ZEEL (-16%), RAMCOCEM (-15%), TORNTPOWER (-14%), HEXAWARE (-14%) and KTKBANK (-11%) were the top losers in terms of open interest.
• Maximum call buying was seen at Nifty 10900 strike and maximum put buying was seen at Nifty 10800 strikes.
• Maximum positions are at 11000 CE and 10500 PE.
• The Nifty Put Call Ratio (PCR) finally stood at 1.64 for January month contract.
• Advance Decline ratio in F&O segment was at 0.18, Advance (33) + Decline (184) + Unchanged (0) = 217
Derivative Idea (19-01-2018)
VEDL losses around -7.30% of open interest as long unwinding on Thursday’s trade. VEDL is trading below 31 and 21 DEMA while RSI showing negative divergence on daily chart which indicate downside momentum is certain in it.
Support at 322. Below 322 panic remain continue till 300--280 mark. Three consecutive close + weekly close below 280 will take it 250--240 mark in days to come.
Hurdle at 345---348
Current chart pattern and derivatives data suggest that we expect further panic in coming sessions.
Trading Recommendation( 19th Jan 2018)
Sell VEDL future on rise around 330 with stop loss of 348 for the initial target 300—280 mark
Glenmark Pharmaceuticals- Top Pick
Glenmark Pharmaceuticals looks good on chart with continuation of Inverse H&S pattern on a daily chart.
With this, 754,667 stocks were traded while the 5 day, 10day & 30 day average volumes were observed to be 1,093,031, 1,404,780, and 1,076,327 respectively. In contrast to previous day’s values, the 5 day average volume fell 687949 stocks, 10 day average volume rose 47055 stocks and 30 day average volume fell 8093 stocks.
Now what to expect???
On Daily chart, Hurdle at 636. Above 636 will see rally till 657---670 in days to come.
Support intact at 615.
Any sharp downside panic will be buying opportunity in it.
Trading Recommendation (19th Jan 2018)
Buy Glenmark Pharmaceuticals above 636 with stop loss below 615 (on a closing basis) Target 657—670.
Results Today
Chennai Petroleum Corporation Limited
Wipro Limited
Tata Elxsi Limited
PC Jeweller Limited
NIIT Technologies Limited
Reliance Industries Limited
Kotak Mahindra Bank Limited
Jubilant Foodworks Limited
Jaiprakash Associates Limited
ITC Limited
HCL Technologies Limited
IDFC Bank Limited
ICICI Prudential Life Insurance Company Limited
HDFC Bank Limited
More Will Update Soon!!
