Nifty future is trading at a huge premium to October future. On account of call shedding at in-the-money strikes for second consecutive trading session and writing at higher strikes indicates upward momentum to continue. However put concentration at 6,000 indicates that it would act as a support for October series but the upside is capped at 6,300 on account of call concentration and less put writing.
Option Analysis:
· Call writing: In today’s trading session, shedding was witnessed at in-the-money strike prices for second consecutive trading session. Major call shedding was witnessed at 5,900 CE of 1.10 lakh shares whereas fresh writing was seen between 6,300 CE and 6,500 CE with majority at 6,500 CE. Concentration is being observed at 6,300 CE of 50.7 lakh shares.
· Put Writing: On the other hand, major writing was seen between 6,100 PE and 6,300 PE with majority at 6,200 of 6.45 lakh shares. Concentration is being observed at 6,000 PE of 75.2 lakh shares.
Implications: Call shedding at lower strikes for second consecutive trading session and writing at fresh higher levels indicates Nifty’s upward momentum to continue. Whereas, put concentration at 6,000 level indicates, 6,000 as to act as a support for October series. However, on the upside Nifty will face resistance at 6,300 on account of more of call concentration than puts.
India VIX
· Volatility for 6th October, 2010 close at 21.73 which is 1.98% lower as compared to previous close, after touching an intraday high of 22.17 and low of 20.59.
Implications: Indian VIX plunged for second consecutive trading session and has been consolidating around these levels. We expect it to move upwards and we are Bullish on the same.
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