Derivatives Weekly View: Positive Bias Remains Intact Till Nifty Holds Above 15900

July 15, 2022
Other Product offerings

Derivatives Strategy
Underlying Action
MCX Buy
JSW Steel Buy
Derivatives Weekly View Duration : 1-2 months
Click here to see open calls

• PRODUCT 1
Positive bias remains intact till Nifty holds above 15900… Quant (Derivatives) Pick
Underlying Action
Tata Steel Buy
ICICI Securities – Retail Equity Research

Hero Motocorp Buy
Duration : 1-3 months
Click here to see open calls
• PRODUCT 2
Research Analysts
Raj Deepak Singh Nandish Patel Dipesh Dedhia
rajdeepak.singh@icicisecurities.com nandish.patel@icicisecurities.com dipesh.dedhia@icicisecurities.com
Siddhesh Jain Saif Mukadam
siddhesh.jain@icicisecurities.com saif.mukadam@icicisecurities.com
Weekly Recommendation
Weekly future recommendations :
Derivatives Weekly View

1) Buy Godrej Properties (GODPRO) July future in the range of | 1337-1347 Target | 1480 and Stop Loss | 1279.5.
Rationale
In the current leg of the market recovery, reality stocks are back in focus. Among reality stocks, Godrej Properties is well
placed to resume its fresh uptrend. Over the past two months, the future open interest in the stock has remained stable.
Recently, closure was experienced along with the up move suggesting ongoing short covering. Even on the options front, the
stock had a sizeable Call base at 1300 and 1340 strike. Last week, it managed to close above these levels, which should trigger
short covering. Hence, we expect the stock to test | 1480 in the coming sessions.
2) Sell Dr Lal Pathlabs (DRLAL) July future in the range of | 1964-1984 Target | 1765 and Stop Loss | 2085.5

Rationale
The stock has underperformed broader markets and witnessed consistent selling pressure over the past six months. In the
June expiry, the stock future had witnessed sizeable short addition, which has been rolled into the July expiry. On the options
front, 2100 Call followed by 2200 Call strike hold substantial OI, which should act as resistance zone. With the recent close
below its support levels of | 2000, we expect the stock to witness fresh sell-off in the coming sessions.
Strategy Follow up
U n d er lyin g V iew S tr ateg y R eco T ar g et S to p lo s s P r o fit/L o s s C o m m en t
D r R eddy's lab Bullish Buy F utures 4330 4750 4114.8 24750 P rofits Booked
IR C T C Bearish S ell F utures 573 515 602.5 -12200 E xit in loss
Source: Bloomberg, ICICI Direct Research

July 15, 2022 2
ICICI Securities Ltd. | Retail Equity Research
Nifty: Positive bias remains intact till Nifty holds above 15900…
 The Nifty lost almost 1% last week as technology heavyweights came under pressure after their below expected quarterly results.
Meanwhile broader markets have done relatively better as pharma, auto and FMCG stocks took the lead. The extended pressure in
markets was experienced after four-decade high US inflation numbers. However, the Nifty was able to hold 15900. Till these levels are
held, we remain positive for the coming sessions
 From a data perspective, Put writing is relatively higher than Call strikes with highest Put base placed at ATM 16000 strike. We expect a
round of recovery towards 16500 if the Nifty is able to hold 15900. The bias will change if the Nifty closes below 15900. In that
scenario, we may see the Nifty moving towards 15600 in coming sessions
 FIIs’ net short positions have increased once again above 1 lakh contracts. Majority of these positions were formed after US inflation
numbers. Hence, we believe these positions are susceptible to short covering. The Nifty may witness a further recovery ahead of
crucial events lined up in the second half of the month
 The volatility index has closed the week at its lowest levels seen since January below 18 levels. Moreover, despite recent weakness

seen in the banking and technology space, the Nifty was largely able to hold its levels. While stock specific volatility is likely to remain
high amid the result season, broader weakness is unlikely till VIX does not move above 20 levels
Nifty options OI build-up
50
45 Call OI Put OI
40
35
30
OI in Lacs
25
20
15
10
5
0
Source: Bloomberg, ICICI Direct Research 15600 15700 15800 15900 16000 16100 16200 16300 16400 16500
July 15, 2022 ICICI Securities Ltd. | Retail Equity Research 3
Bank Nifty: 34500 remains important support for week…
• After testing its Call base of 35500 last week, the Bank Nifty failed to maintain follow up momentum. HDFC Bank, in particular, along
with IndusInd Bank acted as spoilers for the week. However, clear underperformance was seen last Friday where despite the Nifty
moving almost 100 points higher, the Bank Nifty ended marginally negative
• The volatility index has remained subdued for a second week in a row whereas short position by FIIs in index future segment rose
marginally. Now their net shorts moved marginally above 1 lakh contracts. Closure in these positions should trigger meaningful
upsides
• Last week, few Call option strikes of the index saw formation of aggressive writing positions. This has pushed the index towards its
support levels of 34500. We believe for upsides to continue, the Bank Nifty should hold 34500 on a closing basis and stocks like
HDFC Bank, Axis and Kotak Bank should participate
• Recently the rupee made a new lifetime low against the dollar due to which there would be some negative sentiments on the Street.
However, as far as the Bank Nifty is concerned, we believe a close above 35000 would help traders regain confidence. This should

provide further upsides in coming days
Bank Nifty weekly options OI build-up
2500
Put OI Call OI
2000
OI in Thousands
1500
1000
500
0
33000
33300
33800
34000
34100
34500
34700
34900
35200
35500
33500
34300
35000
35700
FIIs’ selling remained low despite weakness…
• Globally, equity markets erased most of the gains of the penultimate week after continued rise in inflation. Almost every asset class
came under pressure. While markets are expecting a 75 bps rate hike in the coming FOMC meeting, a four decade high inflation has
further weakened sentiments. Dollar index continue to strengthen as it attained parity with Euro and GBP moving to its lowest levels
since pandemic. Base metals declined further due to fears of recession and gold has also moved towards the $1700 mark
• FIIs selling pressure declined significantly in the first half of the July series as they have sold almost | 7000 crore in the first half. It is
the lowest FIIs selling pressure seen since November last year. With quarter ending, we have seen this change and despite weak
global markets, Indian indices have shown a bit resilience. At the same time, domestic institutions also paused a bit their buying
spree and bought just | 1100 crore last week
• On the F&O front, the net short open interest from FIIs has increased once again last week as they have crossed 1 lakh contracts once
again. These additional shorts were seen post US inflation numbers as FIIs have sold index futures worth | 2600 crores last week. At
the same time, longs in stock futures also declined marginally last week and FIIs have liquidated positions over | 1250 crore

• Crude oil prices slipped on a strong dollar and risk aversion in global markets. Further, oil slipped on escalating fears about an
economic slowdown. Furthermore, IEA has lowered its outlook for oil demand growth over the next two years. US crude oil
inventories rose by 3.254 million barrels in the week to July 8. We expect Nymex crude prices to slip till $90 level in the coming week
while upsides can be used as a selling opportunity
FII/DII buying in equities (in | crore)
F II D II
D ate In d ex F u t S to ck F u t In d ex O p t C as h C as h
8-Jul 743 892 -1039 119 35
11-Jul -525 -560 2714 359 -297
12-Jul -2815 -1124 -1556 -1457 141
13-Jul 566 11 -3918 -2720 1799
14-Jul -602 -473 7037 309 -556
Rupee: Likely to depreciate further till 80.50 level…
• The rupee depreciated during the week reaching new record low amid
strong dollar and risk aversion in global markets. Further, the rupee Dollar Index vs. US$INR
skidded on persistent FII outflows. Furthermore, India’s CPI data
showed inflation remained above 7% for a third consecutive month
and stayed higher than RBI’s comfort zone
• Dollar index rallied amid expectations that US Federal Reserve will

hike rates faster than its peers to tackle soaring inflation. Further,
dollar advanced on risk aversion in global markets and hawkish
statement from a Fed officials
• We expect the rupee to depreciate further in the coming week till

80.50 amid strong dollar, risk aversion in global markets and

consistent FII outflows. Market sentiments were hurt as aggressive
monetary tightening by major central banks across globe to tame
soaring inflation deepened the concerns about outlook for world
US$INR options build-up
economic growth
Weekly Pivot Levels
Futures S2 S1 Pivot R1 R2
US$INR (Jul) 79.00 79.48 79.81 80.28 80.61
US$INR (Aug) 79.24 79.70 80.03 80.49 80.81
EURINR (Jul) 79.20 79.70 80.29 80.79 81.38
EURINR (Aug) 79.61 80.11 80.68 81.18 81.76
GBPINR (Jul) 93.52 94.01 94.70 95.19 95.87
GBPINR (Aug) 93.86 94.35 95.02 95.51 96.19
JPYINR (Jul) 55.86 56.78 58.39 59.31 60.92
JPYINR (Aug) 57.22 57.60 58.15 58.53 59.07
Source: Bloomberg, Reuters, ICICI Direct Research

July 15, 2022
Source: NSE, Seediff, Bloomberg ICICI Direct Research
1000
1200
1400
0
200
400
600
800
1000
1500
2000
2500
3000
0
500
24-Jul-20 31-Jul-20
24-Aug-20 31-Aug-20
24-Sep-20 30-Sep-20
24-Oct-20 31-Oct-20
24-Nov-20 30-Nov-20
24-Dec-20 31-Dec-20
24-Jan-21 31-Jan-21
24-Feb-21 28-Feb-21
24-Mar-21 31-Mar-21
24-Apr-21 30-Apr-21
24-May-21 31-May-21
24-Jun-21 30-Jun-21
24-Jul-21 31-Jul-21
24-Aug-21 31-Aug-21
Dr Lal Path Labs
24-Sep-21 30-Sep-21
Godrej Properties
24-Oct-21 31-Oct-21
24-Nov-21 30-Nov-21
Recommended Stocks : Historical price performance…
24-Dec-21 31-Dec-21
ICICI Securities Ltd. | Retail Equity Research

24-Jan-22 31-Jan-22
24-Feb-22 28-Feb-22
24-Mar-22 31-Mar-22
24-Apr-22 30-Apr-22
24-May-22 31-May-22
24-Jun-22 30-Jun-22
7

Forthcoming Events…
Date & Time (IST) Country Data & Events
Monday, July 18, 2022
7:30 PM US NAHB Housing Market Index
Tuesday, July 19, 2022
2:00 PM UK Unemployment Rate
2:30 PM Europe Final CPI y/y
6:00 PM US Building Permits
6:00 PM US Housing Starts
Wednesday, July 20, 2022
11:30 AM UK CPI y/y
7:30 PM US Existing Home Sales
8:00 PM US Crude Oil Inventories

Thursday, July 21, 2022
Tentative' Japan Monetary Policy Statement
5:45 PM Europe Monetary Policy Statement
6:00 PM US Philly Fed Manufacturing Index
6:00 PM US Unemployment Claims
Friday, July 22, 2022
11:30 AM UK Retail Sales m/m
1:00 PM Europe German Flash Manufacturing PMI
1:30 PM Europe Flash Manufacturing PMI
2:00 PM UK Flash Manufacturing PMI
7:15 PM US Flash Manufacturing PMI

Forthcoming results…
Symbol Company Purpose Board Meeting Date Symbol Company Purpose Board Meeting Date
BEL Bharat Electronics Limited Financial results 16-Jul-22 INDUSINDBK IndusInd Bank Limited Financial results 20-Jul-22
ICICIPRULI ICICI Prudential Life Insurance Company Limited Financial results 16-Jul-22 HAVELLS Havells India Limited Financial results 20-Jul-22
L&TFH L&T Finance Holdings Limited Financial results 19-Jul-22 RBLBANK RBL Bank Limited Financial results 21-Jul-22
POLYCAB Polycab India Limited Financial results 19-Jul-22 PVR PVR Limited Financial results/Other business
21-Jul-22
matters
ICICIGI ICICI Lombard General Insurance Company Limited Financial results 19-Jul-22 MPHASIS MphasiS Limited Financial results 21-Jul-22
HINDUNILVR Hindustan Unilever Limited Financial results 19-Jul-22 INDIAMART Indiamart Intermesh Limited Financial results 21-Jul-22
HDFCLIFE HDFC Life Insurance Company Limited Financial results 19-Jul-22 CANFINHOME Can Fin Homes Limited Financial results/Other business
21-Jul-22
matters
AUBANK AU Small Finance Bank Limited Financial results/Fund raising/Other ULTRACEMCO

19-Jul-22 business matters UltraTech Cement Limited Financial results 22-Jul-22
AMBUJACEM Ambuja Cements Limited Financial results 19-Jul-22 ATUL Atul Limited Financial results 22-Jul-22

WIPRO Wipro Limited Financial results 20-Jul-22 BANDHANBNK Bandhan Bank Limited Financial results 22-Jul-22
TATACOMM Tata Communications Limited Financial results 20-Jul-22 CROMPTON Crompton Greaves Consumer Electricals Limited Financial results 22-Jul-22
SYNGENE Syngene International Limited Financial results 20-Jul-22 HDFCAMC HDFC Asset Management Company Limited Financial results 22-Jul-22
OFSS Oracle Financial Services Software Limited Financial results 20-Jul-22

Derivatives Strategies: Open recommendations
Date Scrip Action Recommendation
29-Jun-22 Tech Mahindra Buy Long/Short Strategy: Buy Tech Mahindra July 1020 Call at 30-31 & sell 1100 Call at 10-11, Target: 1100, Max loss: 21 points, Time-frame: till July expiry.
4-Jul-22 HDFC AMC Buy Positional Future : Buy HDFAMC JUL in the range of 1867-1877 Target 2035 and StopLoss 1788
5-Jul-22 MCX Buy Positional Future : Buy MCX JUL in the range of 1308-1318 Target 1420 and StopLoss 1263
11-Jul-22 Info Edge Buy Positional Future : Buy INFEDG JUL in the range of 3940-3960 Target 4350 and StopLoss 3740
11-Jul-22 JSW Steel Buy Long/Short Strategy: Buy JSW Steel July future at 585-590 & buy 590 Put at 20-22, Target: 648.5, Maximumloss: 18.5 points, Time-frame: till July expiry.
12-Jul-22 India Cement Buy Positional Option: Buy India Cement July Call 175 STRIKE RATE in the range of 5.4-5.8, Target 10.8, and StopLoss 3.2, Time-frame: till July expiry
15-Jul-22 Godrej Properties Buy Positional Future : Buy GODPRO (GODREJ PROPERTIES LIMITED) JULY future in the range of 1337-1347 Target 1480 and StopLoss 1279.5..
15-Jul-22 Dr Lal Pathlabs Sell Positional Future : Sell DRLAL (DR. LAL PATHLABS LIMITED) JULY future in the range of 1964-1984 Target 1765 and StopLoss 2085.5

Back

Quant Picks: Open recommendations…
Date Scrip Action Price Target Stop Loss Last close Return at close Time Frame
01-Jul-22 Torrent Pharma Buy 1440-1460 1625 1329.5 1530 5.5% 3 months
05-Jul-22 Tata Power Buy 210-216 252 190 221 3.3% 3 months
07-Jul-22 Tata Steel Buy 875-895 1045 799 905 2.3% 3 months
08-Jul-22 M&M Financial Buy 193-197 235 174 203 3.0% 3 months
11-Jul-22 Hero Motocorp Buy 2825-2865 3350 2568 2843 -0.8% 3 months

Back
Source: NSE, Seediff, ICICI Direct Research
Pankaj Pandey Head – Research pankaj.pandey@icicisecurities.com
ICICI Direct Research Desk,
ICICI Securities Limited,
1st Floor, Akruti Trade Centre,
Road no.7, MIDC
Andheri (East)
Mumbai – 400 093
research@icicidirect.com

Disclaimer
We /I, Raj Deepak Singh BE, MBA (Finance), Nandish Patel BCOM, Dipesh Dedhia BCOM, MBA (Finance), Siddhesh Jain, BFM, MBA (Finance), Saif Mukadam BSc, MMS (Finance) Research Analysts, authors and the names subscribed to this report, hereby certify that
all of the views expressed in this research report accurately reflect our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) or view(s) in this
report. It is also confirmed that above mentioned Analysts of this report have not received any compensation from the companies mentioned in the report in the preceding twelve months and do not serve as an officer, director or employee of the companies
mentioned in the report.
Terms & conditions and other disclosures:
ICICI Securities Limited (ICICI Securities) is a full-service, integrated investment banking and is, inter alia, engaged in the business of stock brokering and distribution of financial products.
ICICI Securities is Sebi registered stock broker, merchant banker, investment adviser, portfolio manager and Research Analyst. ICICI Securities is registered with Insurance Regulatory Development Authority of India Limited (IRDAI) as a composite corporate agent and
with PFRDA as a Point of Presence. ICICI Securities Limited Research Analyst SEBI Registration Number – INH000000990. ICICI Securities Limited SEBI Registration is INZ000183631 for stock broker. ICICI Securities is a subsidiary of ICICI Bank which is India’s largest
private sector bank and has its various subsidiaries engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fund management, etc. (“associates”), the details in respect of which are available on
www.icicibank.com.
ICICI Securities is one of the leading merchant bankers/ underwriters of securities and participate in virtually all securities trading markets in India. We and our associates might have investment banking and other business relationship with a significant percentage of
companies covered by our Investment Research Department. ICICI Securities and its analysts, persons reporting to analysts and their relatives are generally prohibited from maintaining a financial interest in the securities or derivatives of any companies that the
analysts cover.
Recommendation in reports based on technical and derivative analysis centre on studying charts of a stock's price movement, outstanding positions, trading volume etc as opposed to focusing on a company's fundamentals and, as such, may not match with the
recommendation in fundamental reports. Investors may visit icicidirect.com to view the Fundamental and Technical Research Reports.
Our proprietary trading and investment businesses may make investment decisions that are inconsistent with the recommendations expressed herein.
The information and opinions in this report have been prepared by ICICI Securities and are subject to change without any notice. The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in
any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of ICICI Securities. While we would endeavour to update the information herein on a reasonable basis,
ICICI Securities is under no obligation to update or keep the information current. Also, there may be regulatory, compliance or other reasons that may prevent ICICI Securities from doing so. Non-rated securities indicate that rating on a particular security has been
suspended temporarily and such suspension is in compliance with applicable regulations and/or ICICI Securities policies, in circumstances where ICICI Securities might be acting in an advisory capacity to this company, or in certain other circumstances.
This report is based on information obtained from public sources and sources believed to be reliable, but no independent verification has been made nor is its accuracy or completeness guaranteed. This report and information herein is solely for informational
purpose and shall not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments. Though disseminated to all the customers simultaneously, not all customers may receive this report at

the same time. ICICI Securities will not treat recipients as customers by virtue of their receiving this report. Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to
your specific circumstances. The securities discussed and opinions expressed in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment objectives, financial positions and needs of specific
recipient. This may not be taken in substitution for the exercise of independent judgment by any recipient. The recipient should independently evaluate the investment risks. The value and return on investment may vary because of changes in interest rates, foreign
exchange rates or any other reason. ICICI Securities accepts no liabilities whatsoever for any loss or damage of any kind arising out of the use of this report. Past performance is not necessarily a guide to future performance. Investors are advised to see Risk
Disclosure Document to understand the risks associated before investing in the securities markets. Actual results may differ materially from those set forth in projections. Forward-looking statements are not predictions and may be subject to change without notice.
ICICI Securities or its associates might have managed or co-managed public offering of securities for the subject company or might have been mandated by the subject company for any other assignment in the past twelve months.
ICICI Securities or its associates might have received any compensation from the companies mentioned in the report during the period preceding twelve months from the date of this report for services in respect of managing or co-managing public offerings,
corporate finance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction.
ICICI Securities or its associates might have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the companies mentioned in the report in the past twelve months.
ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICI Securities or its associates or its analysts did not receive any compensation or other benefits from the companies
mentioned in the report or third party in connection with preparation of the research report. Accordingly, neither ICICI Securities nor Research Analysts and their relatives have any material conflict of interest at the time of publication of this report.
Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions.
ICICI Securities or its subsidiaries collectively or Research Analysts or their relatives do not own 1% or more of the equity securities of the Company mentioned in the report as of the last day of the month preceding the publication of the research report.
Since associates of ICICI Securities and ICICI Securities as a entity are engaged in various financial service businesses, they might have financial interests or actual/ beneficial ownership of one percent or more or other material conflict of interest in various companies
including the subject company/companies mentioned in this report.
ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report.
Neither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned in the report.
We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Equity Research Analysis activities.
This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law,
regulation or which would subject ICICI Securities and affiliates to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in
July 15, 2022 ICICI Securities Ltd. | Retail Equity Research
whose possession this document may come are required to inform themselves of and to observe such restriction. 13

Derivatives Weekly View: Positive Bias Remains Intact Till Nifty Holds Above 15900

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Derivatives Weekly View: Positive Bias Remains Intact Till Nifty Holds Above 15900

Uploaded by

Copyright:

Available Formats

July 15, 2022

Other Product offerings

Click here to see open calls

ICICI Securities – Retail Equity Research

Duration : 1-3 months

Click here to see open calls

Weekly future recommendations :