Nifty December future is trading at a premium of ~22 point with spot. Heavy call writing at higher levels with put shedding indicates less upside to be seen from current levels. However, majority outstanding open interest at 5,700 and 5,600 levels indicates strong support at lower levels. So, we expect market to take support at 5,700 and would face resistance at higher levels i.e. 5,900 and 6,000 levels on account of more call concentration than put.
Option Analysis:
· Call writing: During the week, Major writing was witnessed between 6,000 CE and 5,800 CE where the total outstanding OI added was 42.8 lakh shares with maximum at 5,800 CE of 20.7 lakh shares. Major concentration is observed at 6,000 strike price of 76.6 lakh shares.
· Put Writing: On the other hand, major put shedding was witnessed in in-the-money strike prices. 5,900 PE and 6,000 PE shed 20.98 lakh and 17 lakh shares whereas 5,700 PE added 11.65 lakh shares. Concentration is seen at 5,700 PE of 77.4 lakh shares.
Implications: Heavy call writing at higher levels with put shedding indicates less upside to be seen from current levels. However, majority outstanding open interest at 5,700 and 5,600 levels indicates strong support at lower levels. So, we expect market to take support at 5,700 and would face resistance at 5,900 and 6,000.
FIIs and DIIs activity in capital market segment
· FIIs were net seller of Rs 1,239 crore with Gross buyers of Rs 3,528 crore and Gross Sellers of Rs 4,767 crore.
· DIIs were net buyers of Rs 747 crore with Gross buyers of Rs 2,124 crore and Gross sellers of Rs 1,376 crore.
India VIX (Inverse relationship between Nifty and Indian VIX)
Volatility for 10th December, 2010 close at 21.6 which is 4% lower as compared to previous close, after touching an intraday high of 22.85 and low of 21.4.
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