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THE DAILY TECH TALK Issue No: 41 26th June, 2020

Not a pretty picture – 10278 key level to watch out!

T he market witnessed another volatile day due to June expiry with high swings. The Nifty closed below 10300 levels. It opened with a gap down and tested the sub 10200 before bouncing sharply on the upside towards 10362 levels. Finally, with a profit booking at the end, it closed with a 16.4 point loss. Most of the sectoral indices ended with a minor loss or gain of less than one per cent. The Nifty breadth remained negative.

This June derivative series ended with a higher degree of volatility. The June series ended with gains of 777.65 points or 8.18 per cent.

The price has not changed much in comparison to the previous day. It closed near to the prior day low. On a brisk trading, two significant upswings and one big down swing on 5 minute chart created jitters in the market. Finally, it formed a small body candle show-ing some indecisiveness. The 75 minute chart is giv-ing some clear insight. It took upward channel support and closed precisely on it. On a daily chart, the bear-ish engulfing got a confirmation. Now, Thursday's high 10362 is an important resistance. As long as this is protected, bulls may not get a clear opportunity. As the June series ended with a two-day negative bias, the Nifty forming a shooting star pattern on a weekly chart. In any case, the Nifty closes below 10370, and the shooting star formation will be a reality. At re-sistance levels, these bearish formations are more val-id than elsewhere. The momentum on the upside is clearly waning. As I mentioned earlier, it is the time to be cautious on the long side. A close below 10270 will result in the upward channel breakdown. The tar-get is the rising wedge support line of the 9930 zone. This level is exactly 61.8 per cent retracement of the recent upswing begun on 12th June. Only above 10362, the bulls will get strength.

The Strategy

As we are entering the weekend, it is time trader with a lighter position size. As mentioned above as long as the Nifty trades below Thursday's high 10362 it is better to avoid long positions. We may get a clear long trade entry above this level. For any long posi-

tions, 10278 is the stop loss. But, Below 10278, the Nifty can test 10215 and 10174 levels.

Support 10278 10174

Resistance 10362 10440

NIFTY-75 Mins

NIFTY-DAILY

LEVELS TO WATCH NIFTY

Contact us at: checkmatetrader@onlineista.com

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BANKNIFTY STRATEGY

B anknifty also traded with very high volatility. The Wednesday's bearish engulfing did not get con-firmation as it closed above the previous day's low. On the hourly chart, it closed at upward channel sup-port. It also formed a small body candle. As we discussed earlier newsletter, 21353 will act as an im-portant support for Friday. The Banknifty is also forming a shooting pattern on a weekly chart. A nega-tive close will strengthen the bears next week. The Banknifty sustaining above 21353 may result in some positive bias. Above 21750 it may move further on the upside. Try to be cautious on Banknifty trade on both the sides.

The Strategy

As long as the Banknifty trades above 21353, be with positive bias. Above 21608 levels it can test 21800. Above this level, it can test the 22000 and more. But, ONLY below 21000 Banknifty it may turn weak and it can test 20830 levels. The stop loss for short positions is 21353 (where the risk-reward ratio is not favorable.

BANKNIFTY-75 Min BANKNIFTY– DAILY

LEVELS TO WATCH BANKNIFTY

Support 21353 21000

Resistance 21608 21800

“The only fundamental factor that really counts in the stock market is the Law of Supply and

Demand.” Richard Wyckoff

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STOCK STRATEGIES FOR THE DAY

HDFC (CASH LEVELS)

H DFC closed below the previous day's low. Wednesday's shooting star got confirmation. It was facing stiff re-sistance at Rs. 1860-1875 zone. The earlier breakout has failed. It closed below the 20 DMA and the last two day's volume is higher than average. The MACD has given a sell signal. Sell this stock below Rs. 1777 with a stop loss of Rs. 1790-1811 according to risk appetite. The target is at Rs. 1710. Below this, it can fill the gap of 1st June (Rs. 1676)

HDFC- DAILY

HDFC– 60 Mins

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ULTRATECH CEMENT–DAILY

BAJAJ FINANCE (CASH LEVELS)

U ltratech Cement closed below the 20DMA and confirmed the previous day's bearish engulfing pat-tern. The Bollinger bands are narrowed and indicating an explosive move. It formed head and shoulder pattern on an hourly chart. The MACD histogram is suggesting that the momentum on the downside it is getting strength. The RSI also has given a weak signal. As long as it trades below 20DMA (Rs.3817) be with a cautious approach on the long side. A move below RS.3781 will result in a rising wedge break-down. Below Rs 3781, it can test Rs. 3600.

ULTRATECH CEMENT– 60 MINS

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BIOCON–DAILY

BIOCON (UPDATE)

B IOCON finally has broken out the flat base and decisively closed above the Rs. 400 levels Continue the current long position. Fresh long positions can take above Rs. 403 with a stop loss of Rs. 390-396 zone. The targets are open to Rs. 455.

BIOCON– 60 MINS

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DERIVATIVE INSIGHT

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BULLISH

Symbol LTP %Chg OI %ChgOI

IBULHSG-FIN 226.25 9.88 12558100 49.26

PEL 1336.95 8.89 4043050 28.38

CHOLAFIN 201.65 6.02 7295000 42.13

UJJIVAN 221.7 5.9 2728000 25.51

NA-TIONALUM 34.4 5.85 36431000 35.12

ITC 200.1 5.37 75072000 31.1

SUNTV 417 4.87 5587500 29.75

ADANIENT 163.25 4.85 17876000 21.21

MFSL 530 4.59 1996800 39.76

L&TFH 71.05 4.56 22052400 32.42

BEARISH

Symbol LTP %Chg OI %ChgOI

BERGE-PAINT 522.9 -3.76 4307600 14.97

CANBK 105.3 -3.62 10930000 37.66

ASIANPAINT 1692 -3.45 5351100 30.82

HINDALCO 147.9 -2.67 31738300 22.85

INFY 697.65 -2.67 52898400 23.34

PAGEIND 20299.95 -2.53 116940 16.18

HINDPETRO 213.65 -2.47 16626600 30.74

NMDC 84.85 -2.42 28280700 32.03

AMARAJAB-AT 643 -2.34 1807000 31.04

BPCL 371.4 -2.25 18667800 17.77

PROFIT BOOKING

Symbol LTP %Chg OI %ChgOI

JUSTDIAL 365.05 -0.22 1125600 -10.86

SHORT COVERING

Symbol LTP %Chg OI %ChgOI

GLENMARK 461 0.1 3870900 -1.87