Tag Archives: Nifty

All the Stock market-related news, updates, concerns, strategies and the market outlook for the day.

Market Trade Setup 24th April #NIFTY

The third and the biggest phase of polling is done and we had good polling of 67.41% vs 2014 figure of 67.28% which means we have matched the Modi wave polling and all those who are saying that the polling is less and voters are unenthusiastic need to re-look at their words again. Practically 303 out of 543 seats have polled and the market now knows who is winning and who is not. So, let’s see where it goes from today. US markets closed positive with Dow Jones gaining 140 points but Asian markets are sulking a bit today in flat to negative territory. Hong Kong is down 50 points and Japan is absolutely flat.

Coming to domestics, the polling is over and the higher voter turnout this time indicates that Modi is in the driver’s seat and the higher voter turnout was seen across all states like UP, Kerala, West Bengal etc. Now the focus shifts to a 4th phase which will go to polls on 29th. Another news is the AAP-Congress alliance in Delhi and Haryana did not happen as yesterday was the last day of polls. This also might work in favour of BJP. Lastly, the SC notice to Rahul Gandhi on the Chor remark he made will also create some news. Away from politics, today is another important day for Q4 results with Bharti infratel, ICICI prulife, Indiabulls Housing, M&M Financials, Tata Elxsi and Ultra tech cement coming up with their Q4 results.

On the derivatives front, tomorrow is the monthly expiry for the April series and there are some interesting moves seen. So far we have seen 42.4% rollovers which is slightly higher and what is more important is a lot of FII buying that happened in Nifty Futures and that too for May futures when election results are due. That took the Nifty futures long exposure to 70% and last Thursday it was at 62%. This sudden jump should be seen carefully. n options the Nifty put-call ratio remained steady at 1.30 vs 1.35 seen at the beginning of the day. 11700 call added 11 lakh positions while 12000 call shed 3.9 lakh positions which makes 11700 the highest for this series. On the put side, 11500 put has the highest open interest followed by 11600 put.

What is the Nifty call for the day?

A mildly negative Asia means we are likely to open flat around 11580-11600 zone and this is a strong support zone. If 11570 is taken out then 11520-11550 will be tested. On the upside, 11700-11720 is a strong resistance difficult to overcome. You would have taken long positions yesterday in 11600-11620 mark and today they will give you profits. If the 50 point target is reached then you could exit that position. But I have another trade to suggest now. You can go for a long position in May futures today with 12000 as the target for the election day or the exit poll day. The target can be reached before also. This position can be different from the daily positions you take. There is a chance of 350-400 point profit for the next series and take these positions to benefit from the upmove, which is going to come.

Market Trade Setup 22nd April #Nifty

Last week of April and the expiry week is here. This week has some very important cues, one being the election and the noise of Rahul’s nomination, sexual harassment charges on CJI and its impact on the key judgments waiting to be delivered and the continuing Q4 results that will impact the companies. On Thursday, US markets closed in the positive territory up 110 points but that is very old news. Yesterday’s terror attacks in Sri Lanka where 200 people lost their lives has a major impact on the growth and stability across the World. Added to that are the worries of rising crude prices for India. Crude oil has crossed 73 dollars and its trading at 73.5 dollars now. Asia today is flat with some markets in a mild positive zone and some in a mild negative.
On the domestic front, the focus today will be the Q4 results of Reliance and HDFC that came on Friday evening and Saturday respectively. After many quarters Reliance has disappointed in its petrochemical business with margins disappointing and even Reliance Jio which was having a dream run till last quarter has seen a fall in growth in the number of subscribers, revenue as well as Average revenue per user. So, overall disappointment from Reliance. That disappointment was made up by HDFC which came up with very good numbers. Added to this we have plenty of news from Amethi, where scrutiny of nominations will take place today and the final decision on the AAP-Congress alliance in Delhi and Haryana will be taken today. Tomorrow is the 3rd phase polls as well as the last day for filing nominations for 6th phase, which includes Delhi.
On the derivatives front, we had the 3rd weekly expiry of the April month and it happened on a good volume and turnover of 21.63 lakh crore and that’s heartening. Now, the focus shifts to the April monthly series expiry which will happen this Thursday. Last Thursday we saw a heavy buying in Nifty futures which indicates that there could be some more upside that market saw on the day when 2nd phase polling was happening. We will have to see its impact going into this monthly expiry. The Nifty put-call ratio, however, came down from 1.82 levels to 1.71. 11400 put added 5.1 lakh positions, 11650 call added 2.3 lakh positions and 11600 call added 1.9 lakh positions and 11500 put still has highest open interest of 28.4 lakh positions. On the call side 11800 call added 6.9 lakh positions, 12000 call added 6.8 lakh positions and 11900 call added 5.2 lakh positions. 12000 call still has the highest open interest.
What is the Nifty call for the day?
After 3 day holiday, we are opening today and the opening might be a bit flat around 11730-11760 zone and 11720 is a support that will come. The 11670-11700 is a big support zone and should hold today. Also, a lot of open interest has come on Thursday for 12000 call and we need to see if it continues. If it does, then we can look at 11850 which is all time high being tested and even broken this week. That might take us to 12000 levels also. A lot, however, depends on the election related fundamentals and we need to look at them carefully. So, for today, I would suggest that if you get a dip around 11720 levels or below that, then go for a long position. If Nifty drops below 11670 mark before 10.30am today, then don’t take any positions. Any dip from 11670-11720 levels would be an opportunity to enter again with 11800 as the target. If you have previous positions then keep 11800 as a target to exit them.

Market Trade Setup 18th April #NIFTY

We are back again for the 3rd and the last trading day of the week. Today is a very important day as there are plenty of cues that the market has to understand and digest. There is the 2nd phase of elections going on today and then you have the sad news of Jet Airways and added to that are the Q4 results that are coming. Globally things don’t look great, as Dow ended in a flat zone last night with a loss of just 3 points. But Asian markets look red today as almost all the Asian markets are in flat to the negative zone. Hong Kong and Japan are down 100 points each. Brent crude crossed 72 dollars yesterday when we were not trading but today it corrected to 71.4 dollars.
Coming to domestics, today is the 2nd phase of elections and 95 seats are going for polls today and out of that 52 seats are in South Indian states of Tamil Nadu and Southern Karnataka. BJP has 38 out of these 95 seats so it’s not going to be very crucial but what happens in Tamil Nadu and Karnataka will be closely observed by the market. NDA has just 3 out of 39 seats going for polls today and with the tie-up, with AIADMK anything is going to be gain. So, the better the AIADMK performs the better will be the NDA. Out of 14 seats going for polls in South-Karnataka BJP holds only 6 while Congress holds 6 and JDS 2. This time Cong-JDS are fighting together so it’s going to be a challenge for BJP to protect those 6 seats but infighting in Cong-JDS camp means BJP still has a chance. All this will be visible in market movements today.
On the Q4 results front, Wipro came up with their Q4 on Tuesday evening and it was a disappointment again like Infosys. Mind tree which also came up with the result yesterday was good. So, IT space is mixed with TCS and Mindtree reporting good numbers and Wipro and Infosys disappointing. The big news today is Jet Airways announcing yesterday that all flight operations are going to be suspended today. This reminds me of King Fisher story which reached a peak of 320 rupees in 2008 and came crashing to 13 rupees losing 90% of its peak value when its operations suspended on 20th October 2012. Today King Fisher is at 0. Jet started in 1993, reached a peak value of 1300 in 2005 and even in 2018 its share value was 850. Now on the day of suspension, the share value is at 240 rupees 80% loss from its peak value and now we will see the stock hitting circuit filters and the share approaching to zero if nothing is done to protect the company. Jet presently has more than 1600 employees.
On the derivatives front, today is the expiry day for the weekly series before we go for the monthly expiry next week. The action immediately shifted to options and the put-call ratio jumped to 1.82 from 1.61 mark. Tuesday saw a huge turnover of 10.5 lakh crore and today it will easily cross 20 lakh crore again. 11750 put added 10.9 lakh positions while 11800 put added 8.2 lakh positions and 11700 put added 6.3 lakh positions. 11600 put has the highest open interest of 16.7 lakh and 11700 put has 15.1 lakh. So, 11700 is establishing itself as the base for an up move that happens today. On the call side, 11900 call added 4.5 lakh positions and 11850 call added 3.2 lakh positions. 11900 call now has the highest open interest while 11800 call has a second highest open interest. So, the expiry markers today might lie between 11750 and 11850 with an outside chance of Nifty going to 11700 and 11900.
What is the Nifty call for the day?
Elections hold the key today and the states where BJP is strong like UP, Maharashtra and Chattisgarh will be keenly watched to see if BJP can hold those seats. Potential states like Tamil Nadu, Odisha and West Bengal also will be keen to see if BJP can improve substantially. States like Bihar and Karnataka will be watched to see how alliances work or don’t work. With expiry also adding to it, we will see a lot of volatility. We are likely to open in a flat zone around 11790-11820 zone and as said before Nifty can go to 11850-11900 zone or fall to 11700-11750 zone. But 11760 will be a support and for fall to happen this level has to break. Anything can go wrong, but I believe that the market will go up. So, I would suggest taking a long position in May futures around 11800-11820 mark with 11860-11900 as the target. Exit as soon as the targets are achieved and hold it till the targets are reached.

2nd phase of Lok Sabha Elections 2019 #IndiaVotes #LokSabha2019

1st phase of Lok Sabha elections 2019 got successfully completed on 11th of April with the voter turnout reading at 69.4%. This 69.4% is notch higher than the overall 2014 elections turnout of 66.40%. We are 2 days away from the 2nd phase and the last 5 days after the 1st phase got over, things have gone wild for both the parties. Election Commission banned Modi biopic right before 1st phase and now EC has banned several leaders from campaigning for their communal or unethical usage of words. Yogi Adityanath for 72 hours, Mayawati for 48 hours, Azam Khan for 72 hours and Maneka Gandhi for 48 hours. These are some big events in the last 5 days.

18th is the day of Second Phase and this time there are 96 seats which will go for polling on Thursday. Vellore seat polling has been cancelled after huge amounts of cash were seized in the house of a DMK leader. Like last Tuesday, First, let’s look at the top 10 constituencies of the Phase 2 elections.

1. Thoothukudi: Tamil Nadu is all about DMK and AIADMK. With sympathy running high it’s expected that DMK will win or rather sweep entire Tamil Nadu. But last few days things are getting better for AIADMK-BJP combine. Tuthukudi is the place where state BJP president Dr Tamilisai Soundarrajan is taking on Kanimozhi, the favourite daughter of Late Karunanidhi. With sympathy factor intact, things look a bit tough for Tamilisai.

2. Chennai Central: Sam Paul is contesting from PMK which is another ally of BJP. But then this is not going to make any difference as it seems, Dayanidhi Maran from DMK, two time MP and brother of Kalanidhi Maran is expected to win this seat back.

3. Nilgiris: We have the 2G scam acquitted A Raja from DMK fighting against Thyagarajan from AIADMK. This seat is more important for the people and it’s for them to decide either to vote a corrupt leader or someone else.

4. Siva Ganga: Another blockbuster place. After Chidambaram, we have seen that his son Karthi being pushed into politics. Yet another dynasty mode of politics starting in Tamil Nadu. Will Karthi win his father’s seat or are the corruption charges on the family will prove costly for them? This time BJP candidate H Raja is taking Karthi Chidambaram at Shiva Ganga.

5. Bangalore North: This is the seat of former CM and Union minister DV Sadananda Gowda. This looks more or less like a victory for BJP until or unless any miracles save Congress;

6. Mandya: Interesting story coming from this constituency. Nikhil Kumaraswamy the son of HD Kumara Swamy and the Grandson to Deva Gowda is fighting against the actor Ambareesh wife Sumalatha. Sumalatha is going Independent but is being supported by BJP. The Story is, though JDS and Congress are fighting together, there is a section of Congress leaders from Mandya who are secretly supporting Sumalatha. So, will Sumalatha stage an upset and win Mandya or will Nikhil trump her to retain this traditional JDS seat?

7. Chikballapur: This could be one of the easiest win for INC in South India. Bacchegowda is contesting from BJP but then his opponent is Veerappa Moily from Congress. Veerappa Moily has been a Minister of Petroleum, Corporate affairs, Power in UPA and has been a powerful leader from this region. With JDS also supporting him, the caste equations indicate a clear victory for Moiley.

8. Mathura: Going back to North India. We have Hema Malini contesting from BJP and Mahesh Pathak from Congress. Hema Malini as we know is the famous actress and for the first time, Dharmender campaigned for the Party and his Wife. Hema Malini has already won LS Seat before and will be looking to continue the same this elections.

9. Fatehpur Sikri: This is going to be the close contest between two leaders from BJP and INC. BJP has fielded Sadvi Niranjan Jyothi who is known for her controversial remarks on the opposition. On the other side we have Raj Babbar the actor from Congress. Close contest.

10. Srinagar: This is a going to be an easy win for NC Congress. Farooq Abdullah is the famous J&K leader and no doubt he would win this Seat and we will all see 80 plus Abdulla triumph again from Srinagar.

Coming now a little bit to the statistics, the second phase elections will cover 12 states and the union territory of Pondicherry. Tamil Nadu is the only state where all constituencies are going for polls while in other 11 states it going to be just another phase of the election.

There are totally 1590 candidates in the fray and let’s look at the 2014 results.

List of winners for this 96 in last elections: 
• Tamil Nadu (38) NDA 2 UPA 0 Others 36
• Pondicherry (1) NDA 1 UPA 0 Others 0
• Karnataka (14) NDA 6 UPA 8 Others 0
• Orissa (5) NDA 0 UPA 0 Others 5
• Chattisgarh (3) NDA 3 UPA 0 Others 0
• Maharashtra (10) NDA 8 UPA 2 Others 0
• North East (7) NDA 4 UPA 2 Others 1
• West Bengal (3) NDA 1 UPA 0 Others 2
• Bihar (5) NDA 1 UPA 4 Others 0
• Uttar Pradesh (8) NDA 8 UPA 0 Others 0
• Jammu Kashmir (2) NDA 1 UPA 0 Others 1

So out of the total seats 96,
• NDA won 38
• UPA won 12
• Others won 46

Before ending the post today thought the number of seats that BJP holds look smaller in size one needs to go little deep. Of the 38 seats by NDA, only 27 are held by BJP which means 11 are coming from allies. So diving into the data, we must understand that in the last elections BJP went with only 1 ally (PMK) in Tamil Nadu and won 2 seats. One each shared. This way if we see, BJP has got an alliance with AIADMK now and this is going to be crucial. The mood of Tamil Nadu is quickly changing and the possibility of winning 8-10 seats is very much there for NDA.

The same way BJP is making inroads in Bihar, Bengal and Odisha where BJP tally will improve from 2014. If the results from these three states come good and in the other states if NDA holds on then we can see that NDA may win in the range of 40-45 seats. Not much time left, let’s wait and watch how the 2day of polling goes.

Market Trade Setup 16th April #Nifty

Yesterday I was talking about Nifty closing above 11700 to give an indication that 11760 will be broken and we will go up. But the usual resistance zone of 11680-11700 was difficult to cross and it closed within the range. Better than close at the resistance than to fall and test the support. In that way, its a very positive move from Nifty, but I think we still have to wait for another day to see whether the resistance will be broken or not. Last night Dow closed in a flat to negative territory losing around 30 points and today morning Asian markets also flat with Hong Kong and Japan up within the 20 to 50 point range. Good news is Brent crude fell below 71 dollar mark trading at 70.7 dollars and the Rupee is at 69.42 to the dollar.
On the domestic front, the news of near normal monsoon came at 3.15PM yesterday and markets were least bothered. Actually, IMD needs to do some hard work and needs to come up with accurate forecasts. Last 4 years IMD got it wrong and this year IMD says that there is a 39% probability of normal monsoon while there is a 32% probability of below normal monsoon and 17% probability of drought. When you don’t have even a 40% chance of normal monsoon how can you say that it’s going to be normal and how do you think the market will believe it? This IMD forecast was thrown into junk and the market showed no reaction. The other news is good to trade data coming for March. The Trade deficit narrowed to 10.89 billion in March 2019 compared to 13.51 billion in March 2018. The best news is an 11% rise in exports to 32.5 billion while imports have gone up by only 1.44% to 43.44 billion.
On the derivative front, the only significant point we need to look at in the Futures market is the drop in the Nifty premium from 60 points to 37 points and that is almost 40% fall in premium and that was due to unwinding of long positions as Nifty touched 11700 mark and that brought the overall long positions in the futures market to 62%. In the options market however there was more demand for puts as 4 puts were sold for every call sold and 2 calls were bought for every put bought. That took the Nifty put-call ratio to 1.61 from 1.55 mark. 11650 put added maximum positions of 6.2 lakh while 11700 put added 5.5 lakh positions. 11600 put followed by 11500 puts has the highest open interest for this week’s expiry. On the call side, 4.2 lakh positions added at 11800 call and 2.7 lakh positions got added at 11700 call and 11700 call still has highest open interest but 11800 is close behind. Any up move today will add huge positions to 11800 call making it the new resistance point.
What is the Nifty call for the day?
Today Asia is flat but we are likely to open a bit positive. Point to be noted is, even though the cues were negative yesterday domestically, we did not see Nifty slipping below 11620-11650 mark and closed very close to 11700 mark. That means the election factor and BJP victory is still keeping the markets higher, fighting any negative cues. Today we have the trade data which came positive and that means we will open slightly positive between 11710-11740 zone and that brings us very close to 11761 which is the all-time high. Are we going to hit another all-time high before triggering a selloff or are we going to close above 11760?
Don’t look at losing these 60-70 point chance of making profits but watch carefully and hope that Nifty closes above 11760. Today is also the last day of campaigning for the 2nd phase polling and close above 11750 means market is still sticking to its election fundamental. So, no trade day today, just observe. Tomorrow is a holiday, we can come back on Thursday and look at how things shape.

Market Trade Setup 15th April #Nifty

The shortest trading week of the year so far is here. This is a 3 day trading week with market shut on Wednesday due to Mahavir Jayanthi and on Friday due to Good Friday. In-between you have a weekly expiry on Thursday. So, today and tomorrow are the only normal trading days. The most important news that we would be looking at today is the IMD forecast for this year’s monsoon that will come around 3 PM. Skymet has given a disappointing figure now we will look at IMD to see what it says. If we look at the global markets, they are all celebrating due to strong macro data coming from China, especially the exports going up by 14% and imports coming down. Shanghai market up close to 2% and all the other markets like Taiwan, Korea, Singapore, Hong Kong and Japan all in deep green with Japan and Hong Kong both 300 points in green. US markets also added fuel on Friday with Dow closing close to 270 points up.
Coming to domestics, if the data took China and other Asian markets up, it is the same data that will put pressure on us and we are likely to start flat. The IIP data for February came after markets closed at 5.30pm and it was a big disappointment. IIP grew at just 0.1% vs 1.7% seen in January and this is the lowest in the last 20 months. Manufacturing has actually contracted by growing at -0.3% and thus the demand for electricity came down and it just saw a growth of 1.2%. Electricity usually grows more than 4-5% during the beginning of the summer months. The only saving grace was inflation data for March that came at 2.8% vs expected 3% and the food inflation finally came to positive at 0.3%. The best data is from services inflation which was down to 5% from 5.3% seen in February. On the Q4 results front, while TCS has met the target Infosys has disappointed with margins coming lower and growth guidance also is lower. So, we still have mixed Q4 results.
Coming to derivatives, there was some buying that happened on Friday as Nifty started to pick up in the afternoon due to weekly short covering. The overall long positions in Nifty futures now stand at 63%. Coming to the options market, there was demand for puts and that is visible in Nifty put-call ratio going up to 1.57 from 1.49 at the beginning of the day. 11600 put added maximum open interest of 8.1 lakh and 11500 put added 4.3 lakh positions and 11550 put 3.6 lakh positions. 11600 put still continues to have the highest open interest indicating that 11570 is a support level. On the call side, 11750 call added 2.6 lakh positions and 11800 call added 2.3 lakh positions while 12000 call added 1.9 lakh positions. 11700 call continues to have the highest open interest and a distant second is 12000 call. So, 11740 zones will be a strong resistance for this week’s expiry. But on the April monthly expiry, still 11500 put and 12000 call continues to have the highest open interest indicating that 12000 is possible this series. But 11800 is fast catching up, so it can act as a hurdle on the upside.
What is the Nifty call for the day?
A weak macro data and a disappointing Infosys data means we will start flat in the 11640-11660 levels and on the downside 11570-11580 might offer strong support and if the fall doesn’t happen then 11680-11700 might act as the first resistance. On Friday, we have taken the 11680 as a target and those targets were reached, and you would have exited your positions. Today is a day of uncertainty, so I would suggest not to take any positions today. But if there is a correction to 11570-11580 levels and Nifty stabilizes there then you can go long with 11650 as the target. Else, it’s better to wait and watch if 11680-11720 zone is taken out or not before deciding on further action.

Market Trade Setup 12th April #NIFTY

It was a polling day yesterday for 91 seats across India and it went off well. The voting percentages matched up to the game-changing election of 2014 and conventionally higher voting turnout helps the ruling party and thus BJP will heave a sigh of relief. High voting was observed in Western Uttar Pradesh where BJP holds all the 8 seats that went to polls. Maharashtra also had the poll percentages dropping to 56% compared and all the 7 seats that went to polls in Vidharba are held by BJP. Elsewhere the two seats in West Bengal saw 80 plus percentage polling but polling was less in 5 seats in Uttarakhand where BJP again holding all these 5. Voting was also low in Assam and other northeastern states and in Assam BJP holds 4 out of the 5 seats that went to polls.

So, if we make senses of all these vote percentages and how they translate into seats then the picture we get is mixed. UP matched in its vote share so BJP would have got the vote that it got, but unlike last time this time SP-BSP-RLD are fighting together in these 8 seats and a combined influence will be felt in 2-3 seats and BJP would be looking at these seats with worry. Worries for BJP will come from Assam, Maharashtra and Uttarakhand where the polling was less. Assam has a sizable Muslim population and a drop in voting means BJP voters have not turned up and voted as they did in 2014. Markets will need some time to digest all this and where that leaves Nifty needs to be seen.  In all this CPI, IIP data will be released today after the market hours and so will be the Q4 results of TCS and Infosys coming after markets close.
Coming to derivatives, yesterday was the weekly expiry and we have witnessed one of the flattest expiries in the recent memory. The turnover was also less than 20 lakh crore, something which we have not seen in the last two expiries. The options market buzzed with demand for puts and the Nifty put-call ratio went to 1.47 from 1.33 seen at the beginning of the day. Today is the start of expiry week of 18th April and we again have a 4 day weekly series. 11660,11500 and 11400 puts all added equal open interest and for now 11600 put has the highest open interest but it could change today. Point is 11500 and 11400 are also opening up which means Nifty can go to 11390 levels. On the call side, 12000 call added maximum open interest yesterday but 11700 call continues to have a highest open interest which means 11740 will be a big resistance.
What is the Nifty call for the day?
A mixed Asia and some doubts about which way polling went would mean we open bit gap down around 11550-11580 zone and this is a strong support zone. If 11550 is broken then immediately we can go to 11480-11500 levels and that could trigger a lot of shorting. If Nifty takes support at 11550 and crosses 11600 mark then all is well and we can move forward. Just 1 out of 7 phases is over and we still have 6 phases and nearly 450 seats yet to go for polls. Many things can change during this time and the market knows that. So, I would suggest that if Nifty holds 11550 levels then we can go for a long position with 11620-11640 as the possible targets and those positions can be carried to next week also. But just in case Nifty drops to 11500 and goes below that then wait and watch. Don’t rush.

Market Trade Setup 10th April #NIFTY

Finally, there was a rally in the last hour yesterday much to the relief of many, who were doubting whether Nifty would cross 11600 or would settle down below that but somehow we managed to cross 11600 and went up all the way to 11685 levels and closed almost at the high point of the day at 11671. Globally, however, things are not looking that great. US markets corrected close to 200 points and this is on the worry that came from IMF which has cut the global growth forecast and that seems to be having a major impact across all markets. Added to this is the Trump tweet which talked about imposing trade sanctions, this time on European Union. Asia is also negative today mainly on the IMF growth cut with both Hong Kong and Japan showing 150 points cut each.

On the domestic front, the campaigning for the first phase of elections finally came to an end and a positive close was mainly due to the positive outlook given for NDA that it might come back to power. India Today was the last channel to come up with the forecast and they gave a figure of 263-283 seats for NDA and surprisingly in UP BJP might get 42 seats which was much better than 20 plus seats forecasted 2 months ago. BJP is also doing well in Maharashtra with 40 seats almost the same as what they got last time. The other news today is going to be the IIP and the CPI data that will be released for the month of Feb and March. CPI for March is expected to be around 3% and if it comes in that range it will be a good trigger to look at another rate cut in the June policy of RBI.

On the derivatives front, there has been some selling in the Futures market in the last 2 days which has brought the Nifty futures long positions to 67% from the highs of 71%. This is in a way good as now there are 1/3rd shorts in the system. The options also has seen some trimming of Put call ratio and the Nifty put-call ratio right now stands at 1.42 which is a good level considering that tomorrow is the weekly expiry. Yesterday 11600 put added 5.3 lakh positions and that established 11600 put at the highest open interest which means we have firm support at 11590 levels. On the call side, 11850 call added 6.4 lakh positions and 11800 call has the maximum open interest followed by 11850 call. So, Nifty now has the legs to go up to 11800 by tomorrow. The range is now 11600-11800 mark.

What is the Nifty call for the day?

The positions that you were holding for last 2-3 days finally would have got closed yesterday as Nifty went all the way crossing 11680 mark and that you would have made a 20-80 point profits depending on where you have taken positions. But what is important is that a futures trade is closed, which is very important for small traders. Today the IMF news will give a dip at the opening and Nifty might open around 11620-11650 mark and that also is the support zone. Any correction will bring it to 11590 and Nifty should find a support there. So, it is better to go long at around 11600-11630 mark with 11680-11700 as the target. You can otherwise keep a 50-70 point profit target which can be anytime this week

Market Trade Setup 9th April #Nifty

BJP manifesto took the market down, down to 11550 zones and later recovered to cross 11600 mark and close above that. I was talking about Nifty going to 11580 levels yesterday if the manifesto is not liked by the market and it has happened. If a 11800 close yesterday would have catapult Nifty to 13000 by June, it has now taken away that possibility and we could now see a nervous move ahead and it might want another good news coming from anywhere before it starts to resume the journey again. Globally things were not so great and Dow closed 90 points lower on the forecast that Q1 results for the US are not likely to be in the expected range. Asia is flat to negative with both Japan and Hong Kong down 50 points each and only Singapore and Taiwan are in a mild positive zone.

Coming to domestics yesterday was a clash between BJP manifesto vs Congress’ NYAY. Where Congress focused on the bottom 5% of poor with 72,000 per annum cash transfer, BJP focused on populist schemes aimed at farmers. A slew of measures like a loan at zero interest, farm pensions and cash transfers are going to put pressure on the fiscal health and was not liked by the market that much. Added to this is the pressure coming from Brent crude with crossed 71 dollars now and trading at 71.1 dollars. Rupee also lost 45 paise yesterday and now has reached 69.67 per dollar and all the good work was done to bring it to 68.3 lost out in just 2-3 sessions. Nifty has 20 dma at 11470 mark and that is going to be strong support even if there is some fall happening today. So, we need to look at 20 dma carefully.

On the derivatives front, there was a different reaction in the futures and options market. While there was selling in the day but buying resumed by afternoon in the futures market, the options market has shown one-way traffic and that is the demand for the calls. That has brought down the Nifty put-call ratio from 1.61 to 1.50 and there was the closing of positions seen on many strikes on the put side. 11600 put has the highest open interest at 12.6 lakh while 11500 put also has 12.2 lakh open interest. This is very close so if 11560 doesn’t hold today then we can see Nifty going to 20 dma of 11470 mark. On the call side, 11700 call added 10.7 lakh positions yesterday and it has the highest open interest now at 21.6 lakh. so 11720 is a strong resistance for this week’s expiry. So, unless there is fundamental news, till Thursday expect Nifty to be in 11560-11720 range with a danger of Nifty slipping to 11470 on ant bad news.

What is the Nifty call for the day?
A flat Asia means we will also open in the flat zone between 11600-11620 mark and 11560 continues to be very strong support. Good news might take Nifty to 11680-11710 zones and if that happens, exit positions and book mild profits. Your positions are stuck for almost 3 days now and you need an exit route and let’s hope that this exit route comes today. If things turn to worse and Nifty corrects to 11500 mark, patiently, as things are looking more likely on the upside than on downside in the next 1-2 weeks. No fresh positions to be taken today.