Derivatives Daily Update: September 20 2012

Consolidation Continues: September 20, 2012

Nifty September Futures closed at 5571 down by 41.25 points. Bank Nifty closed at 10952.30 down by 110.10 points. Open Interest in Nifty across all the series was up by 4.82 lakh at 2.52 Cr shares. Turnover was up at Rs 1.26 trillion. Put Call Ratio was up at 1.17 for both Index & Stock Option across all series and for Nifty alone in current series it was up at 1.51 which indicates traders are bullish and they are not in mood to give it up soon. Volatility as measured by India VIX was up by 4 % at 18.62. Dollar Rupee pair was trading higher at 54.31. In all it was a day of consolidation.

I stick to my stand that we are in intermediate Bull Run and this fall from higher level is correction which might stop at 5550. My stand was vindicated today. We have bounced back from intra day low of 5551.25 today. I still believe that target of 5760 is achievable. Medium to long term traders should ride the Bull Run with 5300 as their ultimate stop loss and first price target of 5760. If we sustain above 5760, than we will make a new high in this financial year.

Happy Trading

Atul Doshi

Derivatives Daily Update: September 18 2012

Day of Consolidation: September 18, 2012

Nifty September Futures closed at 5612.25 down by 4.45 points. Bank Nifty closed at 11062.40 up by 85.10 points. Open Interest in Nifty was up by 6.93 lakh shares at 2.47 Cr shares. Turnover was lower at Rs 1.16 trillion. Put Call Ratio across all the series again shot up to 1.08 and for Nifty alone in current series it was up at 1.53. Volatility as measured by India VIX was mildly up at 17.83 and Dollar Rupee pair was also trading slightly higher at 54.04. In all it was a day of consolidation and absolutely range bound movements were witnessed in the market.

In my opinion, medium to long term we are in Bull trend and we might go and touch 5760 in coming week before expiry. In short term though we might consolidate for a day or two and in the process stabilize around 5550. Every dip is a buying opportunity and traders must trade accordingly. Position traders should remain long till major level which is pegged at 5300 is not broken on closing basis.

Happy Trading

Atul Doshi

Derivatives Daily Update: September 17 2012

Bull Run Continues: September 17, 2012

Nifty September Futures opened with a gap for second consecutive day and closed higher at 5616.70 up by 31.80 points. Bank Nifty closed higher by 326.45 points at 10977.30. Open Interest in Nifty across all series was up by 12.32 lakh shares at 2.40 Cr shares. Turnover was high at Rs 1.94 trillion. Put Call Ratio across all the series for both Index & Stock option was down at 0.94. Volatility as measured by India VIX was smartly up by 16% at 17.78 and Dollar Rupee pair was trading lower at 53.81. In all it was a bullish day.

As far as price momentum is concerned it is very much evident in the market. My price target of 5630 was achieved today. In medium to long term it seems that momentum will continue and we might go and kiss 5760 with slight hiccup at 5700. In short run though it seems that we might go and consolidate around 5550 level. The reason which leads me to believe this is twofold. One, Volatility has drastically shot up and if it continues to do so it might put pressure on price of Nifty. Second, Put Call Ratio has fallen below 1 which doesn’t augur well for the market but mind you these are short term hiccups and after that upward momentum might continue. It is advisable to hold your longs or add in dips with ultimate price target of 5760.

Happy Trading

Atul Doshi

Derivatives Daily Update: September 14 2012

Breakout Day: September 14, 2012

Nifty September Futures opened with gap and closed at the day’s high at 5584.90. Bank Nifty too opened with a bang and closed whoopingly high by 424.95 points at 10650.85. Open Interest in Nifty across all the series was up by 20 lakh shares at 2.28 Cr shares indicating Bulls have become aggressive in mopping up their positions. Turnover was up by more than double at Rs 1.95 trillion. Put Call Ratio was slightly down at 1.02 across all the series for both Index & Stock Options but was smartly up at 1.44 for Nifty alone in current series. Volatility as measured by India VIX was down by 2% at 15.38 and Dollar Rupee pair was smartly down to 54.29 helping Rupee to become stronger against Dollar. In all it was a day of Bulls who swept Bears in today’s session.

My belief has once again being vindicated as we crossed 5500 in a style and are approaching fast to kiss another important level of 5630. Undertone is strong, Bulls are active, bears are worried and so it is advisable to remain Bullish in medium to long term. In short term corrections might come which one should use to add positions.

Happy Trading

Atul Doshi

Derivatives Daily Update: September 13 2012

Listless Day: September 13, 2012

Nifty September Futures closed mildly up by 3.75 points at 5450.70. Bank Nifty closed up by 9 points at 10225.90. Open Interest in Nifty was up by 3.75 lakh shares at 2.08 Cr shares. Turnover was slightly less at Rs 819 bn. Put Call Ratio for both Index & Stock Option across all the series was up at 1.08 though only for Nifty in current series it was down at 1.20. Volatility as measured by India VIX was up at 15.67 by 4% and Dollar Rupee pair was also trading slightly higher at 55.46. In it was a cautious day ahead Fed Chairman Ben Bernanke’s Statement on Friday.

I still stick to my opinion that we will go and kiss 5500 in coming days and if we close above 5500 than we will reach 5630. It is advisable to trade with strict stop loss as much awaited and important event has always potential to manipulate the market in either direction. It seems that under current is strong and market might gain further.

Happy Trading

Atul Doshi

Derivatives Daily Update: September 12 2012

Better Day: September 12, 2012

Nifty September Futures closed at 5446.95 up by 41.60 points. Bank Nifty closed at 10216.90 up by 59.40 points. Open Interest in Nifty across all the series was up by 6 lakh shares at 2.04 Cr shares. Turnover was up at Rs 1.17 trillion. Put Call Ratio for both Index & Stock Option was slightly lower at 1.03 though for only Nifty for current series was up at 1.25. Volatility as measured by India VIX was down by 2% at 15.04 and Dollar Rupee pair was also under pressure at 55.29. In all it was definitely a better day.

As said in couple of posts, we are heading for 5500 and if breached probably heading for 5630. Traders are advised to remain long with stop below 5330 or for intra day traders 5390 and for slightly medium term traders 5330. Momentum in market seems to be returning so enjoy the bull ride.

Happy Trading

Atul Doshi