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Market Setup 28th January

The 5th week and the expiry week has begun and we are where we were at the beginning of the series. We have not moved anywhere during these 4 weeks and these last 4 days might not be much of a difference. US markets are on positive territory with Dow gaining for the 5th straight week and on Friday it closed up 180 plus points in green. The promise of an end to the shut down seems to have added a positive trigger to the US markets. Today Asian markets are in green, except Japan and most of them are trading with a 0.5% gain with Hong Kong up by 170 points and Japan is the only market which is down 60 points. Brent Crude has settled itself and its trading at 61.5 dollars. 

On the domestic front, there are problems with ICICI. CBI has raided Chanda Kochhar and her husband along with the Videocon offices and that will have a negative impact on ICICI. The main problem is even the present management of ICICI is named in the scandal of giving undue loans to Videocon for them helping Chanda Kochhar. Apart from that Zee also has some problems as Subash chandra is trying to find a majority stake holder to offload his stake in Zee. Q3 results continue to pour in and so far its mixed bag. Following are the Q3 results expected today: Bank of India, Canara bank, Chennai petro, Godrej properties, Escorts, Radio city, RBL bank, Tata power, TTK, Wockhardt pharma. 

On the derivatives front, the action has now firmly shifted to options from Futures. The Nifty put call ratio fell further to 1.37 from the 1.43 mark where it began on Friday. The turnover in the Index options market was 5.53 lakh crore and that takes the overall F&O turnover to 7.24 lakh crore. On Friday, every strike on put side has unwinding of open interest and we saw 4.1 lakh shares unwinding, followed by 10800 put which unwound 3.3 lakh contracts. Still 10800 put has the highest open interest followed by 10700 put. On the call side 10800 call added 8.2 lakh positions while 10900 call added 7.2 lakh positions. 11000 has the highest open interest followed by 10900 call

What is the Nifty call for the day?

Today, I caution you from trading and I know Monday morning not trading is not a great thing to do. Nifty is at 10780 and its likely to open in that band only between 10780-10800 zone and 10820-10840 is the 20 and 200dma and crossing that is going to be very tough. The downside is also not opening up with 10720-10740 offering a great support for Nifty. In such a scenario I would ask you to wait and watch and if during the course of the day any possibility of an options strategy opens up, I would tweet the same. We need to see if 10820-10840 will be taken out or not easily. Till then no point in going long or short.