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Derivative View for Weekly Expiry – Nov 18, 2021

November 18 2021 | Reading Time: 5 Minutes
Indian benchmark indices may open on a flat note today. At 8:15 am IST, SGX Nifty Futures was trading at 17,879, compared with Nifty’s close of 17,898 yesterday, indicating a muted opening for the bourses.
 
Nifty Futures – LTP 17,909
 
Nifty has been trading in a broad consolidation zone of 17,600–18,300 and marginally trading just above its 50-DMA. The momentum indicator RSI and MACD trending downward indicates a negative bias. The benchmark indices formed three consecutive bearish candles and already breached rising trendline support.
 
On the options data front, PCR for weekly contracts expiring November 18 stands at 0.56. From the OI data for weekly contracts expiring on November 18, maximum Call OI built up was seen for 18,200 strike price, followed by 18,000 strike price, which amounts to 134.58 lakh contracts and 112.50 lakh contracts, respectively. Likewise, maximum Put OI built up was seen for 17,800 strike price, followed by 17,900 strike price, which amounts to 72.92 lakh contracts and 68.11 lakh contracts, respectively.
 
After considering the above points, we expect the index to be volatile with a negative bias. It has strong support around 17,800–17,850. However, sustainable trading below these levels may open more negativity which may lead the index toward 17,500 in a day or two.
 
BankNifty Futures: LTP – 38,139
 
Bank Nifty has been in a downtrend since last week of October and forming lower low lower high price formation on the daily chart. Yesterday, it breached its 50-DMA with higher volume. The momentum indicator RSI and MACD has turned negative and not showing any signs of positivity.
On the options data front, PCR for contracts expiring November 18 stands at 0.51. From the OI data perspective for weekly contracts expiring on November 18, maximum Call OI built up was seen for 39,000 strike price, followed by 40,000 strike price, which amounts to 107.30 lakh contracts and 103.73 lakh contracts, respectively. Likewise, maximum Put OI built up was seen for 38,000 strike price, followed by 37,000 strike price, which amounts to 83.20 lakh contracts and 57.51 lakh contracts, respectively.
 
After considering the above technical parameters and options data, this major sectoral index is trading with a negative bias. However, it may take support around current level and may bounce back from the current level. Long traders can take positions with some extra caution and follow stop loss as the index is not looking that promising. However, some upward bounce back cannot be denied.
 
Bullish setup in stocks such as Apollo Hosps.Enterprise, L&T Technology Services, Maruti Suzuki India, Asian Paints among others.
 
Bearish setup in stocks Petronet L N G, Glenmark Pharms, Aurobindo Pharma such as among others.

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