THE FII WERE NET SELLERS WITH SALES WORTH RS.706.84 CRORES (PROVISIONAL CASH MARKET FIG.)
On weekly basis Nifty posted significant losses of 184 points and closed 3.24% lower at 5512.15. Leveraged positions are comparatively lower at the beginning of new series. 67% roll-over for Index futures (61% in the previous series) and 'Premium' of 24 points on Nifty february future are indication of Trapped 'Long' positions. New series has begun on nervous note. Opening day of new series witnessed addition in OI, 11.17% in value and 3.82% in quantity FII's action is suggestive of 'unwinding' in cash segment and build-up of 'short' positions on Index as well as stock futures. Their heightened activity in 'call-writing' of 5700 and 5800 strikes of Nifty further confirms their view on near-term trend. In absence of triggers in domestic markets other than Q3 earnings from some of the corporate, the 'Action' in markets in the coming week is more likely to be driven by global cues and FIIs 'actions' in domestic markets.
For this week, jump in extending losses in early part of the week is likely. Also 'value-buying' could emerge at lower levels, stabilizing the markets later. Going by 'Option-distribution' pattern, Markets are likely to remain in range of 5400~5700 in the coming week, with action more specific to individual stocks.
On Friday, NIFTY OI PCR 'rose' to 1.31 on the back of heavy PUTs addition (writing) at 5400 and 5300 strikes indicates that as of now nifty may take a good support around 5400 and/or between 5300-5400.
FOR TODAY: SGX Nifty is trading around 5450. Nifty may open around 5450. The trading range will be between 5400-5600. Volatility may be seen.
Below 5510, sell nifty future for target of 5480/5460/5430 and above 5515, buy nifty future for target 5535/5585. Will update later during the trading hours.
