Nifty futures trading at a discount to spot because of dividend, higher call activity at 5,500 strike price along with major put writing at 5,400 levels indicates markets to be range bound. So, we see markets to trade above 5,400 but below 5,500 for intermediate period. The range for August series would be 5,600 and 5,300.
Option Analysis:
· Call writing: In today’s trading session major shedding was witnessed at 5,400 CE of 8 lakh shares and fresh writing of 5.25 lakh shares at 5,600 CE. Out of the total outstanding open interest ~52% is witnessed at 5,600 CE and 5,500 CE. Concentration is observed at 5,600 CE of 79 lakh shares.
· Put Writing: On the other hand, fresh addition was seen between 5,500 PE and 5,000 PE with maximum at 5,400 PE of 12 lakh shares. ~38% of the total put open interest is witnessed at 5,400 PE and 5,300 PE. Concentration is observed at 5,300 PE of 91 lakh shares
Implications: Heavy call writing at higher levels and put writing at lower levels indicates markets to trade in a narrow range. However more call writing at 5,500 indicates strong resistance level and more of put writing at 5,400 indicates strong support level. The wide range for August series is 5,600 and 5,300 on account of concentration.
FIIs and DIIs activity in capital market segment
· FIIs were net buyers of Rs 688 crore with Gross buyers of Rs 2,715 crore and Gross Sellers of Rs 2,027 crore.
· DIIs were net sellers of Rs 276 crore with Gross buyers of Rs 1,016 crore and Gross sellers of Rs 1,292 crore.
India VIX (Inverse relationship between Nifty and Indian VIX)
· Volatility for 4th August, 2010 close at 17.04 which is 2.91% lower as compared to previous close, after touching an intraday high of 17.64 and low of 16.74.
Implications: Indian VIX plunged further for consecutive third trading session and made a new low of 16.74. We expect it to move upwards and are Bullish on the same which would have negative effect on Nifty.
No comments:
Post a Comment