Higher put writing than calls at 5300 indicates strong support and major call writing at higher levels than puts indicates resistance at higher levels. We expect markets to trade in a narrow range of 5,400 and 5,300 for intermediate term; however the range for July expiry would be 5,500 and 5,300 on account of concentration.
Option Analysis
· Call Writing: Fresh major call writing was witnessed between 5,600 and 5,400 strike price with majority at 5,600 of 3.22 lakh contracts and shedding at 5,200 of 1,32 lakh contracts. Concentration observed at 5,500 of 1.32 crore contracts.
· Put Writing: On the other hand, fresh writing to the tune of 8.09 lakh contracts was witnessed at 5,300 strike and shedding of 4.12 lakh shares at 5,100 strike. Concentration observed at 5,300 of 96 lakh contracts.
Implications: On account of concentration, we expect the markets to trade in the range of 5,500 and 5,300 for July series. However for intermediate term 5,400 would act as a minor resistance on account of more call concentration witnessed as compared to put.
FIIs and DIIs activity in capital market segment
· FIIs were net buyers of Rs 153 crore
· DIIs were net sellers of Rs 261 crore
India VIX (Inverse relationship between Nifty and Indian VIX)
· Volatility for 19th July, 2010 close at 20.71 which is 5.13% higher as compared to previous close, after touching an intraday high of 20.87 and low of 19.36.
Implications: Indian VIXs surged in today’s trading session. We are “Bullish” on the same and expect it to move upwards which would have a negative impact on Nifty.
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