F&O Show: Strategy For Nifty And Bank Nifty's Expiry This Week
InCred Equities' Gaurav Bissa shares F&O strategies for Nifty and NiftyBank and shares his top F&O picks.
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00:00 Hello and welcome. This is BQ Prime. I am Agam Vakil and you're watching the FNO Show.
00:05 Well, a step forward and a step backward. That's how things are panning out as far as
00:09 Indian markets are concerned. And that's exactly what we're seeing with respect to the Nifty
00:15 as well as the Bank Nifty. We're looking at an advance, a day in advance, and then we
00:20 see a sharp fall and another day following a green candle would be followed by a red.
00:26 So it certainly is a little bit confusing for a lot of investors and traders specifically
00:31 out there. And while we do have a lot of data, which does suggest a little bit of short covering
00:39 coming through on Friday, today we are seeing that bit of reversal come through as well.
00:44 So we're going to talk about a lot of these aspects. And of course, very quickly before
00:50 I bring in our expert for today, touch upon what's happening in the options market as
00:55 well. As far as your 5th October expiry for the Nifty is concerned, Max OI is around 1,600
01:04 and a call and the 1,500 put. It doesn't necessarily mean it's a range because we've seen a very
01:11 sharp change in ranges on an every single day basis. But for now, we are certainly looking
01:16 at more and more writing at the 19,500 calls as well as puts. As far as the Bank Nifty
01:22 is concerned, we're once again, looking at the 44,500 mark, which has served as a pivot
01:30 as we've been talking about not just today in the last week, but over the past four or
01:34 five months. And today is not any different, but a lot of the activity has now shifted
01:40 towards the 44,300 calls as well as puts where we're seeing a flurry of activity coming through.
01:46 In fact, the 44,300 put is also where we saw max open interest as far as the weekly options
01:53 expiry is concerned. But what do we make of it? Are we expecting consolidation? Are we
01:59 looking at strength? Are we looking at weakness going forward? Let's bring in an expert for
02:05 today. We have Gaurav Bissa. He's the Vice President at Intra at Securities, who joins
02:10 us on the show. Gaurav has been looking at the markets for a very, very long time. And
02:16 of course, his experience will be valuable to us. Gaurav, good morning and thank you
02:19 so much for joining in. Let's start with the benchmark, the key benchmark here at the Nifty.
02:24 What's the way forward here?
02:25 Gaurav Bissa, Nifty Investor Good morning. Thank you for inviting me to
02:29 the show. Well, when it comes to Nifty, we have seen consistent formation of lower tops,
02:34 lower bottoms on hourly and two hourly charts. Basically, it's a sign of a downtrend. And
02:39 we have seen multiple supports being broken, being taken out. The only positive aspect
02:44 at this point in time is on closing basis, we are not close below 55 day exponential
02:50 moving average since April of 2023, which is currently placed around 19,500 spot levels.
02:56 So on intraday perspective, we are breaching those levels. But on closing basis, we are
03:00 generally inching higher. So if that is taken out, if we are closing below 19,500, then
03:06 this fall can augment towards 19,300, which can be seen in a matter of three or four days.
03:13 But if you look at hourly charts or 120-minute chart, you will see that there is a proper
03:18 RSI, the RSI we are seeing. So on that perspective, as I said that the current levels are lucrative.
03:24 As a disclaimer, what we have advised is buying the current junctions and Nifty to our clients.
03:29 We are not playing for a major upset. Maybe a 200-250 points bounce back, a temporary
03:34 bounce back can be seen. And after that, we can again see a benefit slip in towards 90-200.
03:39 So on a very limited basis, I'm looking for a bounce back in Nifty index, which can be
03:43 seen either today or tomorrow.
03:45 All right, Gaurav. And would your assessment of the Bank Nifty be similar?
03:49 Yes. So if you look at the structure of Bank Nifty, when Nifty made a fresh swing low,
03:58 it broke the previous swing low. Bank Nifty did not do that. In the previous swing low,
04:02 it has sustained above those levels. And that is making it interesting. It is also trading
04:06 in rising channel patterns. Supports are around 44,000. So as long as 44,000 is sustained,
04:12 Bank Nifty can go towards level of 45,200 to 45,500. Again, as I said, this is going
04:18 to be a temporary bounce back sort of. But at the current juncture, I'm playing more
04:21 of a bounce back because the risk reward for fresh shorting is not that lucrative. And
04:27 also, if there's a small stability that comes when the global market, you know, then it
04:32 can result in a very swift upside and trigger the stock process. So as I said, the risk
04:37 reward for long, at least for a bounce, is more competitive for the short side.
04:42 Absolutely. Very evident in a lot of these option premiums as well. Something which has
04:49 been observable of late. But I'm going to, you know, very quickly also address a handful
04:55 of stocks which are in focus, at least in the futures and options space. And besides
05:00 the fact that we are looking at a lot of traction with respect to your benchmarks in the key
05:05 Nifty 50 stocks, where we have seen a fair amount of changes over the previous few days.
05:13 Of course, in terms of advanced declines, there are more declines in today's day of
05:15 trade as against advances. And naturally, on an expected basis, because the markets
05:21 are weak, a lot of the auto stocks will be in focus. So in today's day of trade, we are
05:25 looking at some weakness in Ayesha Motors and Maruti Suzuki, as well as Hero Motor
05:29 Corp for that matter. Of course, these are reacting to the monthly volumes. And we are
05:34 looking at a little bit of weakness and thereby at least shorts building into the system in
05:39 today's day of trade. That said, what's also keeping or helping the markets remain, you
05:45 know, perhaps supporting the markets to a certain extent is HUL, Nasian Pays from the
05:50 consumption space and Adani Ports, which is the other stock in focus as far as Nifty 50
05:56 is concerned. But Gaurav, I'll come to you. You do have two calls on your radar, one long
06:03 and one short. Can you take us through those?
06:06 Yeah. So if you look at the overall setup in the broader markets, you'll find that there
06:14 are certain stocks which have been stable, if not going higher. And buying those stocks
06:18 would make more sense because once market weakness abounds, these stocks will tend to
06:22 see far superior returns. So on that perspective, Core India is looking good. There are two
06:27 or three reasons. One, it is part of Nifty PSA index and public sector stocks, if you
06:32 see, they have been very stable. They have been outperforming. Core India witnessed a
06:37 decent breakout on point and figure charts. We have seen decent amount of additions also
06:41 happening in Core India. It is sustaining those levels at a time when Nifty was correcting.
06:46 Core India has been more of a stable one. So one can keep a stock price of 275, play
06:51 for targets of 330. Second would be a sell on AU Bank. If you see banking stocks, your
06:58 larger banks have been stable, if not very weak, apart from ICICI Bank. Beyond that,
07:03 if you see whether we're talking about Axis Bank, which has been very stable, ICICI Bank,
07:08 not falling, not rising. It's been stuck at the same levels. Same goes for Edison Bank.
07:13 But if you look at AU, small finance bank, you will see that it has been consistently
07:17 breaking multiple support areas. There have been decent amount of shorts also in the system.
07:21 It is still making fresh swing lows. So on that perspective, one can create a short in
07:25 AU Bank, keeping a stock price of 730 and play for targets of 680.
07:30 Okay, that's those are some of the stock views coming in from Gaurav. Gaurav, we do have
07:36 a little bit more time. So I want to quickly address the Finn Nifty as well. Before I go
07:42 to Gaurav on his view on the Finn Nifty, what we're seeing, of course, is, well, the weakness
07:48 are seeping through because of the indices across. As far as the Finn Nifty expiry goes
07:53 in today's trade, we are looking at a lot of traction around the 19,700 mark, that is
07:59 the calls and the puts. And well, at the moment, of course, there is max OI around the 19,700
08:09 call and the 19,800 call as well has a substantial amount of accumulation in OI. So, well, I
08:17 reckon that at least a lot of these option writers will look to these specific levels
08:22 to if they haven't already deployed their selling strategies here. Well, Gaurav, I'm
08:27 going to come to you. In general, how would you play today's expiry when it comes to the
08:31 Finn Nifty? What's your view here?
08:33 If you look at Finn Nifty, it has been trading in a range of the last four to five days of
08:40 data. It's been more of a range bound one. Currently trading in the support area. The
08:46 pressure will mount once Finn Nifty futures goes below 19,685. It will see a fresh break
08:52 down. On pointed figure charts also we are seeing a break down sort of happening. And
08:57 even at 10 minutes or 5 minutes close below 19,685 on intraday perspective, we can see
09:02 a fall happening towards 19,450. So, there can be increased pressure that can be seen.
09:08 But I would not recommend shorting at the current juncture. I would wait for confirmation
09:12 to happen once it trades below 19,685 on the future side.
09:16 Okay, Gaurav, we leave it at that. Thank you so much for joining us and taking us through
09:20 your views on the markets. Well, we're going to keep an eye on a lot of the facts that
09:26 Gaurav took us through. For now, the Nifty is trying to defend the 19,500 level at the
09:33 moment where we have seen once again a lot of writing based on support, specifically
09:39 support writing. But time will tell whether or not we do eventually close below 19,500
09:45 in today's trade. But signing out for now. There's lots more lined up. Stay tuned to
09:51 BQ Prime and we will keep bringing you more.
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