PL Research: PL TECHNO - DERIVATIVE REPORT SEPTEMBER 2023

PL Technical Research: Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher Pvt.

PL Derivatives Research: Shilpa Rout, Derivatives Lead Analyst, Prabhudas Lilladher Pvt Ltd.

Nifty

Technical View:

Nifty for the entire month has been moving within a range between 19600 and 19250 zone with 19250-19270 zone acting as the crucial and important support zone which is also where the significant 50EMA level lies and we have witnessed a reversal on 3-4 occasions from this zone to indicate a pullback. On Friday, Nifty indicated a massive gain closing on a strong note near 19450 zone with sentiment once again turning positive and upside a decisive breach above the 19550 zone shall establish a strong conviction to anticipate for further upward movement and can re-test close to the 20000 landmark once again in the coming days. At the same time, only a decisive breach below the 19250 zone shall negate the view and weaken the overall trend to anticipate for further slide with next major support zone visible near 18850-18900 zone with 19000 acting as the psychological level in-between. So, keeping an optimistic view, we maintain a cautiously positive approach till the time 19250 is sustained and expect for further rise in this month and one can go for select counters.

Derivative View:

NIFTY rolls are at 78%, which is lower than previous month of 64%, and in line with past 5 months average, with price action also witnessed a 2% drop on series basis. Weekly option chain reflects on 19200PE holding overall 0.91 lakh OI contracts and on Monthly basis 19000PE adding 1.28 lakh OI contracts. CE writers on weekly basis are active at 19400/19500 strikes - each with more than a lakh OI contracts, and monthly basis 20000CE holds the maximum exposure, followed by 19500CE - 0.5 and 0.38 lakh OI contracts respectively. PCR_OI at 19200 on weekly expiry is over 8 and 19300 is nearly 1.3, which is crucial to monitor closely to determine the direction.

BankNifty

Technical View:

BankNifty also in a similar pattern has been witnessing a rangebound movement with 45000 acting as the tough resistance barrier and downside has maintained 43500-43600 zone as an important and crucial support zone. With most of the major frontline banking stocks indicating sluggish movement for the time being, there is no significant rise in the index. BankNifty need to give a decisive breach above the 45000 zone to confirm a positive trend and then anticipate for further rise in the coming days with next upside targets of 46300 and thereafter 48000 levels visible. At the same time, the zone near 43500 need to be sustained, failing which the index can witnessing further selling pressure weakening the bias with next major support zone lying near 42300-42500 zone. Overall, we maintain a cautious positive approach for the index till 43500 zone is maintained and expect for further rise once 45000 level is breached decisively.

Derivative View:

BANKNIFTY rolls are at 77%, lower than the average, with series to series price action, it is down by nearly 4.5%, indicating fresh shorts.

The Monthly and weekly option chain reflects on 44000PE - holding the max OI contracts, followed by 43000/42000 strikes respectively (Monthly/weekly). CE writers on monthly expiry outshine their positions at 46000 strikes, followed by 45000 zones, with PE writers look convinced on not more than another 2% fall for the Index.