Infosys has clearly spoils the festive spirit. Yesterday we have seen the biggest fall in infosys in the last 6 years, where the stock fell 16% intraday and that pulled Nifty down by 70 points. The fact that Bank Nifty is better performer than Nifty is the proof of the fact that if Infosys was not there, things would have been different for Nifty. Today, we have mixed cues globally, Brexit is again stuck in problems and 31st Oct deadline seems almost improbable.
A new time table has to be drawn out now. Dow was flat, digesting all the news and it closed 40 points down. Today, Asian markets are also in uncomfortable territory and all of them are in mild red. Hong Kong is the worst performer down by 130 points while Japan is down 10 points. Brent crude is stuck at 59 dollars.
On the domestic front, its Infosys that pulled the sentiment down and we were able to somehow manage to hold onto the 11580 levels and closed just above that. Technically, Nifty is in the bullish territory and the level to watch out is 11380-11400 mark where 20day and 100 day moving averages coincides. Nifty might not go there at all and much of it depends on the incoming Q2 results. Yesterday, Axis bank and Kotak came up with good numbers indicating good news for bank.
Also we have Tata global beverages and Jubilant food works also coming up with decent numbers. The only disappointment is RBL bank. Today is an important day with auto companies Hero and Bajaj reporting their numbers. Construction major L&T and electrical company Havells also will be declaring their Q2 numbers and will be watched closely.
On the derivative front, though there was a lot of selling by both FIIs and DIIs in cash market, there was a net buy to the tune of 595 Cr in Nifty futures market where significantly the Nifty futures premium jumped from 7 points to 30 points during the day. The overall long positions in futures also jumped from 44% to 46% indicating short term bullishness. So expect 11700 and more in next few days.
In options however the Nifty put call ratio dropped from 1.44 to 1.20 as there was unwinding of puts seen across the strikes. Now 11600 put and 11500 put have highest open interest on put side and coming to call side, 11700 call added 10.1 lakh positions followed by 11800 call 7.3 lakh positions and 12000 call 5 lakh positions. 11700 call has the highest open interest on call side followed by 11800 and 12000 calls.
What is the Nifty call for the day?
Yesterday, if you have bought the 10.30am dip then you would have made money by mid day, as Nifty rallied towards 11700 but if you have entered post noon, you would be having positions open.
Today, we are likely to open very flat between 11580-11610 mark and 11550-1180 will be a very strong support for Nifty, which should hold. If that happens, then you can go long there with a target on the upside of 11650-11690 levels. There is a resistance at 11690-11720 levels and its tough for it to break today. Maybe the election results tomorrow, might make Nifty to break that levels and take us above that. So, for today, exit positions if Nifty crosses 11680 mark.