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Tuesday, 25 October 2011

Derivatives Daily Update: 25.10.2011

Smart Expiry: 25.10.2011

Happy Diwali

On price front Nifty October Futures opened at 5129.70, went down to 5086.65, made a high of 5192.85 and finally closed at 5191.60. Bank Nifty opened at 9703, went down to 9325.05, made a high of 9890 and closed at 9511.60. Banks were particularly weaker as reflected by Bank Nifty.
 
SYMBOL     EXPIRY OPEN  HIGH LOW CLOSE CHG
NIFTY      29/09/2011 5129.7 5192.85 5086.65 5191.6   85.8
BANK NIFTY  29/09/2011 9703 9890 9325.05 9511.6   -141.95

On volume front, total no. of contracts traded were 97.88 lac and total turnover recorded was 2.49 lac Cr, much much higher than yesterday. Put Call ratio was 0.89 and volatility as measured by India VIX came down by 12% to 22.31. Traded quantity, no.of contracts and no. of trades of Nifty Futures across all the series were hugely up from yesterday's level. Even Open Interest was hugely up by whooping 6169050 shares. 

SYMBOL     EXPIRY  OPEN INT CHG IN OI TR QTY CONT TRADES
NIFTY      25/10/2011 6737350 -2856250 5389500 107790 11645
NIFTY      24/11/2011 26186250 8891850 10704150 214083 66642
NIFTY      29/12/2011 1196150 133450 241900 4838 2270
TOTAL
34119750 6169050 16335550 326711 80557

On stock futures front heavily trade counters were SBIN, RELIANCE, ICICI, LT, AXIS. Top gainers list included HOTELEELA 14% YESBANK 9%, STRTECH 9% JINDALSAW 7% and JPPOWE 7%. Top loser were DCHL -12% MOSERBAER -10% VIPIND -7% TULIP -6% TITAN -5%.

On stock option front, actively traded counters on volume parameter were SBIN 1900 CE, SBIN 1850 PE, RELIANCE 860 CE, SBIN 1850 CE, SBIN 1950 CE,

On nifty options front, increase in open interest was seen in 5200 CE (3385700) 5300 CE (214350) 5000 PE (2547400) 5100 PE (1805950). Decrease in open interest was seen in 5000 PE (-1617600) 5100 PE (-2694150) 5500 CE (-194150) 4700 PE (-424950) 4800 PE (-317100) 4900 PE (-376300) 5200 PE (-1312950).

On technical charts, the much resisted level of 5175 was breached today. As said in earlier posts there was nothing sacrosanct about this level except the fact that  it acted as stiff support when market was in uptrend and when it broke this level it acted as stiff resistance. Real test is 5240 which is 50% retracement level of bear trend(5760-4718) and 5360 which is 61.8% retracement of the bear trend(5760-4718). Yesterday's momentum both price wise & volume wise if sustained in coming days we might be able to visit 5240 & even 5360.

In nutshell, Firstly it is early to draw any conclusion from 1 day's price movement and secondly we are truly entering in to major resistance zone of 5240 -5360. If this congestion area is breached with same kind of momentum as we saw today chances are there that we may have entered in to bull trend once again and in that case every dip in price will warrant a buy. But till the time we are below this levels, in my view we are in bear grip and every rise in price till this level warrants a sell. Trade cautiously with adequate stops.

Happy Diwali and Happy New Year to one and all.

Happy Trading Of-course,

Atul Doshi

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