By Ruchit Jain
Post final week’s expiry, we witnessed a niche down opening for our markets and promoting strain was seen all through the week. Both Nifty and Bank Nifty proceed so as to add quick positions within the derivatives phase which added gas to the continuing correction. In the center of the sequence, the choice writers had positioned themselves in 16000 strike within the weekly as effectively the month-to-month expiry contracts. As this degree received breached on the weekly expiry day (Yesterday), they needed to run to cowl their positions which resulted into added promoting strain.
Now, the quick positions fashioned are nonetheless intact and there’s no respite seen up to now. So the pattern continues to stay adverse for the markets. FII’s have been promoting relentlessly within the money phase as the worldwide markets too have seen sharp sell-off. In the index futures phase, they began the May sequence with quick positions and actually have added extra shorts on this expiry. Their ‘Long Short Ratio’ within the index futures phase stands round 17% which is the bottom in current occasions. This clearly exhibits their bearish bias for the quick time period.
On the opposite hand, the retail trades have ‘Long Short Ratio’ of 62% and it appears they’ve been reluctant to exit their positions would have resulted in incremental losses. India VIX has additionally risen steadily to over 24 degree. The solely knowledge which offers some hopes for a pullback is the PCR-OI which is oversold. Hence, we may see a lot awaited pullback transfer in subsequent few periods, however any such upmove ought to solely be seen as a aid rally inside a downtrend.
In the choices phase, 16000 put possibility had first rate open curiosity excellent however as this degree was breached, the put writers needed to cowl their positions. The choices knowledge signifies resistances round 16200 and 16400 ranges. Any pullback transfer in the direction of the resistance is more likely to see promoting strain once more and therefore, merchants ought to proceed to remain cautious till there’s change in knowledge. The assist for the approaching week will probably be initially seen round 15500-15400 adopted by 15000 degree.
(Ruchit Jain is the Lead – Research at 5paisa.com. Views expressed are the creator’s personal. Please seek the advice of your monetary advisor earlier than investing.)
Source: www.financialexpress.com”