Day of Consolidation or End of Rally?: January 30, 2012
Nifty after opening weaker failed to garner support from Bulls and gave away all its gain of 2 days. It closed at 5112.10 down by 100.70 points. Bank Nifty too closed lower at 9549.55 down by 244.40 points. Yesterday too we witnessed some profit booking in Bank Nifty and today also it dropped and in process dragged Nifty to lower levels. Volumes were higher than yesterday on both Options and Futures segments. Open Interest in Nifty Futures came down by 17.98 lakh shares to 2.37 Cr shares which reflects Bull unwinding or profit booking. Put Call Ratio too came down to 1.07 from 1.21 indicating Call Writing happening instead of Put Writing. Volatility as measured by India VIX shot up by 8% to 23.46. Dollar Rupee pair too was trading stronger at 50 up from yesterday’s level. In nutshell profit booking was witnessed in market as markets were not sustaining at higher levels.
Today Nifty February Futures gave away all its gain which it accumulated in last 2 days. As Nifty has not managed to cross and stay above its 200 DMA, I feel that it will consolidate between 5050 & 5250. Once it breaks on either side momentum will gather in the direction of breakout. In short term my advice is to accumulate in dips with stop below 5050 on closing basis. In longer term Nifty needs to break falling trend line joining multiple tops which is positioned at 5220 on closing basis. Once it clears that zone decisively we will trade in to new territory which might give an upside of 5 to 10 % from 5220.
Top five individual stocks which gained today were JINDALSWHL 11%, JUBLFOOD 5%, STRTECH 4%, HAVELLS 4% and MRF 3%.
Top five individual stocks which lost ground were BHEL -11%, EKC -10%, JISLJAL -9%, BGRENERGY -9% and SKUMARSYNF -9%.
Top five individual stocks which attracted higher volumes were SBIN, ICICIBANK, RELIANCE, LICHSGFIN and TATASTEEL.
Top five individual options which attracted higher activity today were SBIN 2100 CE, RELIANCE 820 CE, RELIANCE 840 CE, SBIN 1900 PE and SBIN 2000 PE.
Nifty option series where POSITIVE change in open interest was seen were 5100 CE ( 2.49 LK) 5200 CE (6.57 LK) 5300 CE (11.52 LK) 5400 CE (8.82 LK) 5500 CE (1.89 LK) 4600 PE (5.47 LK) 4700 PE (7.11 LK) 4800 PE (1.19 LK) 4900 PE (4.88 LK)
Nifty option series where NEGATIVE change in open interest was seen were 5100 PE (-1.71 LK) 5200 PE (-6.12 LK)
Outstanding open interest in Out of the Money Call Options stood at 1.83 Cr shares and that of Put Options stood at 3.43 Cr shares. Outstanding open interest in In the Money Call Options stood at 99 LK shares and that of Put Options stood at 40.54 Lk shares.
Happy Trading
Atul Doshi
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