CNX Weekly

CNX Nifty (CMP 7751):

Indices have scaled to a new life time closing high on account of buying support being witnessed on all dips on account of optimism ahead of the Union Budget to be rolled out this week despite increasing worries of deficient rainfall which could lead to Inflation stoking up & current ongoing Geopolitical tensions arising w.r.t Military activities in Iraq.

Upcoming week would be full of action with Rail Budget to be announced on Tuesday, Economic Survey on Wednesday, Union Federal Budget on Thursday & IIP data & Infosys Q1 results on Friday.

With 7800-8000 CE having maximum OI of 41-76 Lakhs each & along with 7500-7400 Put having an OI of 45 lakhs & 36 lakhs respectively, 7580-7610 is a key support for the next few sessions & 7910-7940 is key resistance going forward.

Expect Nifty to find support around 7600 & till this support zone holds, can further inch higher upto 7890-7920.

Above 7920, the move could gather further momentum upto 8010-8080.

If Index breaks & sustains below 7600, would lead a retest of support zone around 7450 zone. 

Weekly Range could be 7600-7920.  

Technically, Key Oscillators RSI, Stochastic & MACD are placed above their respective averages on the Daily as well as Weekly charts indicating buying support on all dips.

On the Derivatives Front,

W-o-W NIFTY saw long build up from lower levels, saw OI addition of 4%, with price moving up by 2%; Also premium increased closed at highest point for July series, clearly reflecting Bullish under tone.

BANKNIFTY also saw supportive  buying W-o-W OI addition of 5%, with price moving up by 2%, On other hand CNXIT saw unwinding of Longs 5% OI decline, with weekly index closing in red, implying Cyclical stocks are back in flavor. 

BANKNIFTY (CMP 15556):

CMP 15,305. Last week, Bankex gathered support around 14,950 zone & inched up higher towards 15,550-15,600.

Now Going Forward, till 15,290 zone holds, expect the index to witness further upside upto 15,950-16,100 zone again.

However, if it breaks & sustains below 15,290 zone, 14,960-14,600 would be witnessed.  

Going forward,

Movement of the Markets would be dictated by FII Fund Flows, expectation w.r.t to rollout of the Railway as well as Union Budget, IIP data, Commencement of the Q1 results season, development pertaining to geopolitical crisis in Iraq, progress of Monsoons, Global Market Trends, movement of Rupee against the Dollar & crude oil price movement.

USDINR (CMP 59.71):

USDINR has consolidated & traded in a 1.5% band between 59.40 & 60.40 for the last 15 sessions. Now Going Forward, Till Rupee holds 58.75 zone, would once again move upto 62 zone.

BRENT CRUDE ($ 112.4)

As the news-flow pertaining to Iraqi crisis have somewhat reduced, Crude Prices have settled & consolidated at higher levels around 112-113$ which is almost at a 9-10 month high.

Till the geopolitical crisis remains unsolved, Brent Crude would finding support around 110 $ & thus if it holds 110 $, will move upto 118-119 $ zone.

Midcap: (CMP 11421)

NSE Mid-cap CMP 11,421 has witnessed buying on all dips & gained 5% for the week gone by & has outperformed the broader indices. 

Going Forward 11,200 is held, expect the current medium term uptrend to continue upto 11,950 where the current upmove could end & reversal can be witnessed. Break & sustenance below 11,200 with volumes could lead to a retest of 10800-10720 zone.

Small Cap (CMP 10508):

BSE Small-cap CMP 10508 has witnessed buying on all dips & gained 4.5% for the week gone by. 

Going Forward 10270 is held, expect this current uptrend to continue upto 10270 where the current upmove could end & reversal can be witnessed. Stay cautious as RSI on weekly charts is at extremely overbought zone above 90.

Break & sustenance below 10270 with volumes could lead to a retest of 9950-9800 zone.

VIX (18.16):

VIX in the past 3 week has been steadily trading between 14 to 20 post elections during the last 2 months.

Above 20, it would directly spike upto 24-27 zone. Till its below 20, we could witness bulls ruling & buying on dips would be witnessed. 

• FII’s for the past week have stayed net buyers in the cash market but sellers in derivatives markets while DII’s have been Net sellers for the week gone by. 

• On a Weekly basis In Index Futures FIIs were Net Sellers to the tune of ` 23 Cr with an open interest increase of around `846 Cr which indicates Short Build Up in Index Futures by FIIs.

• Nifty PCR_OI has slightly risen to 0.75 compared to 0.74 week earlier.

• NIFTY 7500-7400 PE highest OI 45-36 lakh shares, implying 7590-7610, strong support; On other hand 7800-8000 CE total OI 41 & 76 lakh shares; expected range coming week 7600-7920.

• Nifty Futures have closed at a 30 point premium compared to 34 points a week earlier.

Cumulative FII Derivatives Stats from 30/06/2014 to 04/07/2014:

Index Futures: -23 Cr;

Index Options: +870 Cr;

Stock Futures: -835 Cr;

Stock Options: +4 Cr

Cash Market:

FII: +5330 Cr;

DII: -2842 Cr. 

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