*Pre-Market Derivatives and Technical Set-up*
● Nifty index opened with marginal gains, but bears took the gap up opening as short opportunity. However, index took support around 9050 levels and rebounded piercingly in the later half of the session. Eventually, it concluded the session on a flat note and formed a Hammer kind of candle on daily chart. On intraday chart, we are witnessing a Head & Shoulder pattern and a breakdown below 9000 may result into further selling pressure towards 8800 then 8600 levels
● Going forward, immediate support is placed at 9000 then 8800 zones, while major hurdle is placed at 9350 and then 9450-9500 zone
● On monthly options front, Max Call OI is at 10000 then 9500 strike while Max Put OI is at 9000 then 8500 strike. We have seen Put writing at 8800 then 8500 strike whereas Call writing was seen at 9300 then 9600 strike. Option data indicates an immediate trading range in between 8800 to 9500 zones
● India VIX fell down marginally by 0.43% at 38.01 levels. Overall higher volatility could continue to keep roller coaster ride in the broader trading band
● Bank Nifty remained in negative territory for major part of the last session and formed a Bearish candle on daily chart. It is sustaining below Trendline breakdown level and 20 DEMA, which doesn’t bode well for the bulls. RSI also turned downward from its resistance zone on both daily and weekly chart, indicating weakness
● Looking at the current structure, till the time it sustains below 19500, we may see selling pressure towards 18200 and below that 17500 and 17200 level. While resistance can be seen at 19500 and then 19800-20000 zones
● Longs in Escorts, Motherson Sumi, Manappuram, Mindtree and Vedanta
● Shorts in PVR, M&M, Equitas, Cummins and Ujjivan
*Technical & Derivatives Research, Motilal Oswal*
