Markets Today - 21/4/2010 - India - Sensex & Nifty

Market Overview

Decreased Markets trading at premium and higher activity of put at lower levels indicates market in process of bottoming out at current levels. But, we see volatility as a major concern because of its lower levels.

Option Analysis

·         Call Writing: In today trading sessions, weak overall activity was observed across the strike prices. Some fresh writing was witnessed at 5200CE and shedding at higher levels. Major concentration of open interest is still observed at 5400CE strike price of 82.9 lacs shares.

·         Put Writing: Lower levels strike prices witnessed higher activity as compared to higher levels. Major writing was observed at 5100PE and 5200PE of 5.1lakh and 3.1 lakh shares respectively. Major concentration of open interest is still observed at 5200PE of 92.2 lacs shares

Implications:  More activity at put than call with fresh writing at lower levels indicates market bottoming out at currents levels for April Series. But, we do not expect significant upside.

 FIIs and DIIs activity in capital market segment

·         FIIs were net buyers of Rs 83 crore with Gross buyers of Rs 2,731 crore and Gross Sellers of Rs 2,648 crore.

·         DIIs were net buyers of Rs 25 crore with Gross buyers of Rs 1,181 crore and Gross sellers of Rs 1,156 crore.

India VIX

·         Volatility for 21^st April, 2010 close at 19.2 which is 7.85% lower as compared to previous close, after touching an intraday high of 20.3 and low of 19.

Implications: We still maintained our view on volatility, to go LONG on VIX and SHORT of NIFTY on account of inverse relationship 


Thanks,
Dewang K Mehta
DENIP Consultants - www.denip.in