Markets and News
Yesterday was a huge rally and the targets given in bank nifty have been met and nifty gave you 50-55 point gain from 10750-10760 level where you would have entered. If you have exited then you have a great opportunity to re-enter, else you will have to wait for some more time. The US markets last night were fine with Dow gaining almost a 100 points, but looks like that bullishness is limited to only US. Asia did not carry it forward and every market in Asia is in red today with Hong Kong losing over 300 points. India will also get impacted by this.
Domestic Cues
On the domestics, there are few international cues that will affect the market today the primary being the G7 meeting where the most developed nations will meet and make announcements that will have some impact on emerging markets including India. Second is Brent Crude which is at 77.3 dollars now and that might put an end to a 10 day fall in Petrol prices which have corrected almost a rupee during this period. That might affect the sentiment of the market. Today it would be mostly the technicals that would support the market in the absence in any meaningful fundamentals. 10930 on 15th May is the top and 10565 which is the 50dma is the strong support.
Derivatives Action
On the derivatives front, there was some more buying that has happened on the Nifty futures and the overall long positions now stand at 45% and with shorts still more than 50% it could mean that there is always a chance of correction. The options market also showed lot of bullishness yesterday and the Nifty put call ratio surged to 1.49 from 1.40 and that is due to huge surge in put positions. 10700 put added a whopping 10.1 lakh contracts yesterday and 10800 put added 7 lakh positions. 10600 put still continues to have the maximum accumulated open interest of 43.2 lakh contracts and still 10560 should be a strong support for this series and this coincides with the 50dma of Nifty.
What is the Nifty and bank Nifty call for the day?
Ups and downs are the part of the game and one needs to keep that in mind. If you have not exited the position taken yesterday you might have to take it to next week. If you have exited it after a 50 point gain above 10810 then you have another chance to enter into the market. Today, weakness in Asia means India also will open in red probably around 10710-10730 levels. If Nifty remains there without breaking 10680-10700 mark then it is better to take another long position around 10710 with 10800 as the target sometime next week. Ups and down are part of the market and one needs to have to stomach to take it, so its a risk you are taking.
Its a weekend and Bank Nifty will be volatile and its better to wait and watch rather than taking any positions there. Avoid Bank Nifty for today.