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Derivatives and Quantitative Outlook

* In the recent Nifty consolidation, midcap and small cap stocks are witnessing a catch up exercise. We believe the Nifty may continue its consolidation for some time after the sharp up move seen in the last couple of months. However, a fresh up move is likely to be seen in FMCG stocks where apart from sectoral heavyweights, select midcap stocks are likely to perform in the coming sessions. Stocks like Marico, which has been witnessing delivery based buying interest, is likely to resume its positive momentum on the back of fresh positions in the futures segment

* Leveraged positions in the stock have declined noticeably in the last couple of months as the stock witnesses a short covering trend. The current open interest in the stock is one of the lowest seen in six months below 1 crore shares while the stock has shown an inclination of up move with long accumulation whenever open interest moved to below 1 crore. We have seen initial signs of fresh long additions in the stock, suggesting further upsides on the back of fresh accumulation

* The stock has seen continuous buying support near | 505-510 levels. It has been trading above these levels for almost last three series. At the same time, with continued Put writing at 500 and 520 strikes, we expect downside risk to be limited. Further, Call OI of 540 strike is already witnessing closure in the September series suggesting positive bias in the stock. These positions are expected to aid it in breaking the option range on the higher side

* The stock has seen one of the notable delivery based action around | 510 in the last week. Since then, it has been crawling northwards with early signs of the stock making a base at the support area

* Since July 2022 to till now, the stock has witnessed a time base consolidation between the range of | 510 and | 550. Currently, all the data points indicate that the stock is well placed to cross the hurdle levels of | 550 and may witness breakout from the current consolidation

* Note: Call has been initiated on iClick2Gain on September 22, 2022

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