MOSt Quantitative

Outlook Weekly

Index

Nifty

Sensex

6th Jan 2017

CMP

8244

26759

Support

8100 / 8000

26400 / 26100

Resistance

8350 / 8450

27200 / 27450

NIFTY WEEKLY

Breach outside the 'Spinning Top' formation to attract momentum & extend the move towards 8350-8450

We recommend being selective during volatile times unless Index surpasses the high of the pattern with good margin

Ongoing momentum could stall below 8130 & hence remains a stop for trading longs

Option band saw expansion from 200 points to 400 points at 8000-8400 level. Significant incremental activity was seen in

8400 CE and 8200 PE while shedding was seen in 8200 CE.

With onset of earning season; sector specific volatility could emerge. Thus it is advisable to create adequate hedge.

Energy witnessed a sustained upmove & its placement within the leading quadrant on our sector rotation model encour-

ages fresh longs

SECTOR

NAME

Energy

FMCG

Banks

Media

Dharmesh Kant

Head - Retail Research

OUTLOOK

FOR THE WEEK

Positive

Positive

Neutral

Neutral

Sacchitanand Uttekar

Technical Analyst

POTENTIAL

MOVERS & SHAKERS

ONGC, GAIL

Britannia

HDFC Bank

ZEE Ltd

Tina Gadodia

Derivatives Analyst

1

MOSt Quantitative Outlook

Weekly

NIFTY DAILY

6th Jan 2017

On a daily scale the Index registered a faster retracement as compared to its previous wave which raises the probability of

an extension towards the Island Gap support in the coming weeks. Though the index has managed to maintain its bullish

sequence but a consistent close above its 200 DEMA placed near 8260 would warrant the bullish momentum. Only a breach

below 8130 (Low of Weekly Spinning Top) would negate the setup & remains a vital stop for trading longs.

NIFTY OPTIONS OI VS PRICE

Nifty continued its upward trajectory post its stellar rally witnessed in last week of December series. Volatility index

remained sub 15%. Option band saw expansion from 200 points to 400 points at 8000-8400. Significant incremental activity

was seen in 8400 CE and 8200 PE while shedding was seen in 8200 CE. Foreign Institution activity suggests fresh long was

initiated in Index future along with adequate hedge by put. With onset of earning season; sector specific volatility could

emerge. Thus is advisable to create adequate hedge.

2

MOSt Quantitative Outlook

Weekly

BANKNIFTY OI

6th Jan 2017

Week gone by saw traces of short covering in Bank Nifty. Option data shows 18000 as highest put concentration while 19000

as highest call concentration. Further both PSU banks and Private banks saw short created in December series rolled over to

January series. In scenario of positive momentum; Bank Nifty and individual banking stocks could witness further short

covering. Thus selective bet on long side is recommended in banking sector.

OPTION STRATEGY

BANKNIFTY

BUY

Modified Bull Call Spread

3

3

Bank Nifty is in Short Unwinding cycle

Option indicative band suggest 19000 as highest call

congestion while 18000 as an immediate put conges-

tion

Unwinding in 18500 CE could accelerate buying momen-

tum towards 19000

Considering we are participating rising momentum,

Modified Bull Call Spread is recommended

: INR 9000

: INR 3000

: Sell Future below 17300

Buy 18600 CE 25 Jan'17 1 lot; Sell 19000 CE 25 Jan'17 1 lot;

Sell 17300 PE 25 Jan'17 1 lot

3

3

Target

Stop Loss

Hedge

3

MOSt Quantitative Outlook

Weekly

NIFTY ENERGY

6th Jan 2017

The ongoing uptrend within the 'Rounding formation' augurs well for a sustained upmove. Also the index continues to hold

its ground within the leading quadrant on our sector rotation model. We expect the sector to revisit its intermediate high

near 10800. Hence we continue with our positive outlook on the sector & encourage longs within the same.

ONGC

ONGC witnessed a strong rebound post the ‘Doji’ formation reconfirming the strength in the support & the ongoing upmove.

We expect the stock to rise towards its 'Rounding' pattern target placed at 222. Declines if any towards 198 would provide a

decent reward to risk opportunity for longs with a stop below 191.

4

MOSt Quantitative Outlook

Weekly

6th Jan 2017

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