In today trading sessions, we have observed short covering at lower levels which was reflected in discount turning into premium of ~2 points with increase in open interest. On options front, more of CE activity was seen than PE activity indicating positive momentum losing grounds after breaking a major support levels 5370/5350. Higher Call activity was seen at 5,400 and 5,300 adding more than ~23 lacs and ~12 lacs respectively. However, higher PE shedding was seen across the strike price except 5200 which added ~2.81 lacs shares. However, despite the fall of ~4% , Concentration of PE still stands at 5,400 and CE at 5,700 strike price. Further pessimism can be expected if the Nifty is unable to sustain above 5300 levels in the next couple of trades. On the higher side, accumulation at the 5,600/5,700 Call-strike poses a significant resistance. The Nifty has an immediate support at 5,300 and resistance at 5560 levels.
India VIX (Inverse relationship between Nifty and Indian VIX)
· Volatility for 8th February, 2011 close at 24.7 which is 0.20% higher as compared to previous close, after touching an intraday high of 25.3 and low of 23.2
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