Last week, a sharp bounce-back materialised, trimmed the weekly losses for Indices. Week started on very nervous note with markets extending losses. Sentiments remained battered almost all through the week. However, hopes returned towards close of the week with markets staging sharp come-back despite negative economic data and non-supportive global cues.
On weekly basis Nifty 'dropped' by 86 points and closed 1.59% lower at 5310. SENSEX too over the week was 'down' by 280 points and closed 1.55% lower at 17,729.
In F&O, overall 'Open Interest (OI)' rose by Rs. 9,753 cr. to Rs. 1,41,475 cr. over the week. In quantity terms, OI went up by 6.83% to 245.62 cr. shares from 229.91 cr. shares in the previous week. OI in stock futures, in quantity terms went up by almost 3% to 189.84 cr. shares over the week. This suggests of mild build-up of positions in stock future segment. This trend was also observed in some sectors lilke AUTO, BANKING/FINANCE, CONS/INFRA, CEMENT, FMCG, METAL, OIL/GAS POWER and TELECOM.
Volatility Index (VIX) slipped mildly by 3.85% to 23.47 from 24.41 in the previous week. Nifty OI PCR slipped to 1.02 from 1.11 levels over the week. This drop in Nifty OI PCR is largely due to the significant addition in 'CALLs' OI (around 5300 & 5400 strikes in FEBRUARY Series). Over the week, Nifty CALLs February 'added' 18% in OI to reach 5.18 Cr shares, whereas Nifty PUTs FEB added5%in OI to 4.25 Cr shares.
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OUTLOOKS FOR NEXT WEEK (FROM DIFFERENT BROKING HOUSES):
SMC GLOBAL: "Nifty has resistance between 5,450-5,550 and Sensex between 18,200-18,600.We expect that the RBI would continue with its anti-inflationary focus of monetary policy and would likely to raise the policy rates by 25bps in the next mid quarter review".
CANMONEY: "For the coming week, Nifty has support at 5280, 5215 and 5125 levels while resistance at 5360, 5445 and 5525. Meanwhile, important Sensex support levels are 17610, 17430 and 17135 and resistance levels are 17890, 18075 and 18450. Technically, Friday's recovery in the indices was accompanied by strong volumes - in fact, this the highest up day volumes in more than two months. This gives a hint that it wasn't just short-covering there is some investment buying may have taken place also. Friday's trading has formed a 'reversal day' pattern (lower bottom, higher close) which depicts that a pullback rally may happen soon.
BAER CAPITAL (Alok Sama): "We have probably seen the worst run-up in oil prices. Also, I feel inflation fears here are probably over-done".
JM FINANCIAL (Gautam Shah): "The bearish continuation pattern target of 5260 & 17500 has been done, which is a positive development. However, the reversal pattern target of 5150 & 17000 is yet to be done and hence some more weakness can be expected infra, real estate, power and the ADAG group could be on course to test their March 2009 lows".
KR CHOKSEY SHARES & SECURITIES (Deven Choksey): "One should look forward to more opportunities on the buying side".
MITESHTHACKER.COM (Mitesh Thacker): "The Nifty may re-emerge at 5380-5410. 5350 and 5400 are broadly the two targets for the bounce back".
DIPAN MEHTA, Member BSE & NSE: "Any level in the Sensex below 18,000 and Nifty below 5400 are good levels to buy. Any negative news flow may act as a dampener".
“There is a lot of global liquidity. We all know that after quantitative easing (QE) it is just that India has been put on a pause for the time being and the minute they feel that the situation is improving, money will come back to India".
RAJESH JAIN, Independent Market Strategist: "Markets need some sustenance around the 5300-5350 levels and going forward into Monday it would be important to check out whether the recovery today had more to do with short covering of all the shorts created during the week.
FAIRWEALTH SECURITIES (Sharmila Joshi): "It does look like there is a bit of sell off left in the market".
ANAGRAM: Although 'mild', markets posted 'Losses' for 3 successive week and the 'fall' is now slowing (It was 1.59% last week, with 2.11% and 3.24% in previous two weeks). Sharp bounceback towards end of the week, which saw Nifty recovering by whopping 132 pts from intraday low. Sharp fall of over 8% in Nifty OI PCR to 1.11 over the week is suggestive of 'LONG' build-up on Nifty options. Moving of Nifty Feb future from 'Discount' to 'Premium' of 7 pts to the spot, along with rise in OI is also suggesting fresh build-up of Long positions on Index. FIIs action in F&O segment on Friday suggests heavy build–up of fresh long positions on Index Futures. Slippage in Volatility Index (VIX) is indicative of recovery gathering momentum. On the whole, most of the parameters are suggesting 'pull-back' to continue in the coming week. With No fresh negative cues in domestic markets and the globel ones easing, one can expect 'recovery' to gather momentum in the coming week.
SWASTIKA: “If Nifty closes above 5300 for 2-3 sessions consecutively, it may witness a pullback till the levels of 5400 and 5480. Currently, 200-Days SMA (Simple Moving Average) of 5,627.11 is acting as a good resistance for Nifty. The way the realty and infra stocks are crashing day-by-day and other Big Boys are also becoming weak day-by-day, it seems that Market is not in a mood to revert, but is in a mood to test a deep correction further”.
MANSUKH: “Remember we have said that below 5,630 (200 dma) sentiments remain subdued and we might see some sharp drift near to 5,200-5,250. We likely to continue this approach in the upcoming week though possibility of consolidation due to oversold technical indicators wouldn’t be rule out. Hence traders are advised to remain cautious at this stage and use ‘sell on rally’ strategy until and unless 5,630 wouldn’t breach down with decisive volumes. On the flip side any bounce back from current levels may reap indices towards 5,630-5,650 level where we might see some sort of consolidation. Any break out above this may generate some suggestive buying opportunities though 5,800-5,850 might be the next resistance zone”.
Data Source: NSE, Moneycontrol.
