Nifty future is trading at a premium of ~30 points to November future. Shifting of call concentration at 6,500 and fresh writing in put at 6,100 and 6,200 indicates the range of markets shifting higher and markets gaining strength at current levels thereby setting for an up move. However, on the upside, 6,200 continues to act as a resistance on account of more call concentration than puts. Thus the range for November expiry is 6,300 on the upside and 6,000 on the downside.
Option Analysis:
· Call writing: Shedding was seen at in-the-money strikes with maximum at 6,100 CE for consecutive third trading session. Whereas fresh writing was seen at higher strikes with majority at 6,400 CE and 6,500 CE of 4.4 lakh and 4.2 lakh shares respectively. Concentration is has shifted from 6,300 CE to 6,500 CE.
· Put Writing: On the other hand, major fresh writing in puts was seen at 6,100 PE and 6,200 PE of 8 lakh and 115 lakh shares respectively for consecutive second trading session. Concentration is witnessed at 6,000 PE of 61.5 lakh shares.
Implications: Shifting of concentration in call option at 6,500 levels and fresh writing in put 6,100 and 6,200 levels indicates markets gaining strength at current levels and setting for an up move. However on the upside 6,200 levels continues to act as a resistance on account of more call concentration than puts. The range for Nifty for November expiry is 6,300 on upside and 6,000 on the downside.
FIIs and DIIs activity in capital market segment
· FIIs were net buyers of Rs 987 crore with Gross buyers of Rs 3,224 crore and Gross Sellers of Rs 2,236 crore.
· DIIs were net sellers of Rs 370 crore with Gross buyers of Rs 1,419 crore and Gross sellers of Rs 1,790 crore.
India VIX (Inverse relationship between Nifty and Indian VIX)
· Volatility for 03rd November, 2010 close at 21.5 which is 1.32% higher as compared to previous close, after touching an intraday high of 21.66 and low of 19.23.
Implications: Indian VIX traded in a narrow range and closed at the high of the day. We expect it to move upwards and we are Bullish on the same which would have negative impact on Nifty.
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