Derivatives Weekly View (June 4): Nifty support at 15400 in current uptrend - ICICI Direct

The Nifty continued to trade higher and gained another 1.5% last week without any major participation from index heavyweights. Broader markets continued to perform well and both midcap, small cap indices registered gains of more than 2.5% each last week. Going ahead, we expect some consolidation in the index with support near 15300 in the coming week.

Going ahead, participation from index heavyweights will be crucial for continuance of the up move. While heavyweights from banking and technology space are hovering near their highest Call bases, further consolidation cannot be ruled out. In such a scenario, one should create long positions on any profit booking. We expect 15300 to act as immediate support for the index.

Bank Nifty: Major Call OI in ATM strikes suggest consolidation

Major indices started the June series with higher OI base at ATM strikes. Even though supportive buying was seen there is no closure in ATM strike Calls.

For the week, banking stocks remained almost flat with stock specific activity. Last week we saw addition in 35500 strike straddle. On the back of that the index ended almost flat.

Positional Future Recommendation

Hero MotoCorp

Rationale

Most auto stocks performed well in the expiry week and then saw consolidation. Hero MotoCorp relatively underperformed and was facing a hurdle near its major Call base of 3000. The stock has finally managed to close above Rs. 3000 levels along with closure in ATM strike Call. We feel in the two wheeler space, follow up rally in Hero MotoCorp is expected amid short covering. It is well placed to move towards Rs. 3200.

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Source : Equity Bulls

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