Another all time high closing and Nifty is now at 12100 mark. Looks like Nifty has crossed the 11850-12000 zone for good and seems to have decided to move ahead, but if we look at yesterday’s performance its not very convincing for Nifty to go up. It remained in a 30 point range of 12070-12100 for most part of the day and closed at the top end of the range.
Let’s hope that today it will continue the journey upward. Globally things are looking mixed, with Dow Jones again closing at another all time high as Dow gained 40 point in the trade. Trump’s resolution on Hong Kong seems to have upset the Asian markets a bit and they are trading in a mixed zone. Japan and Hong Kong both are flat but the former is up 16 points while the later is down 10 points. Brent crude cooled off a bit and trading just below 64 dollars at 63.9.
On the domestic front, there was a lot of discussion yesterday in Rajya Sabha on the state of the economy and for me the most important point is the Govt’s forecast of Q2 GDP which it says will grow at 4%. For me this is shocking because even a foreign company like Nomura gave 4.2% figure so am surprised how Govt is saying 4%. The annual GDP is expected to be 5 to 5.5% but honestly I feel the number could be above 4.5% for Q2.
A 4% growth is the lowest in a decade and that is coming at the highest ever Nifty levels. Surprising. Another news that market will watch is happenings in Maharashtra where Uddhav will take oath as CM at Shivaji park today evening. Technically the 11920 the 20dma will act as support for any correction for the Nifty while on the upside sky is the limit.
On the derivatives front, today is the expiry day for the November series and there was a lot of action of futures front as the trend is bullish because even on the day of expiry there is a 23 point premium on Nifty, which is very rare. On the options front, the Nifty put call ratio also surged to 1.63 from 1.52. 12100 put yesterday added 13 lakh in open interest while 12050 put added 5.8 lakh positions and 12000 put still continues to have highest open interest.
On the call side 12200 call added 2.3 lakh positions while 12150 call added 2.2 lakh positions and 12100 call has the highest open interest on the call side followed closely by 12200 call. So, the range for expiry today is 12000-12100 and if there is an upward movement then it could be 12050-12200 mark. So expect some volatility.
What is the Nifty call for the day?
Today is the expiry day for the November series and after a very flat day yesterday, today it is going to be another flat opening around 12090-12110 levels and from there we could see resistance coming in at 12130-12150 levels and if that is taken out expect Nifty to go closer to 12200 mark.
If that doesnt happen then there would be some correction on the down side to 12050-12080 range which is a nice place to enter for a long position with 12130 as the target. In my view the expiry will happen in 12050-12180 range and Nifty will move in this range so its safe to go long at the dip and exit near the higher end of the range.