12th Oct' 2021 (Evening)

12th Oct' 2021 (Evening)  -- | Written at 11.00 PM |

  • Following a weak set of global cues, both Nifty and Bank Nifty opened lower today, consolidated for a good time and then made a sharp recovery to close at the high end of the day's range. 
  • The closing of Nifty close to 18000 and Bank Nifty above 38500 is a good indication of momentum and is a sign of possible expansion of the market further.
  • Nifty
    • Nifty opened 30 point lower and gradually declined by 50 points before making a sharp recovery of 130 points and closing at 17991.
    • Nifty made a strong bullish candle on the daily chart and indicates strength.
    • Support
      • First support at 17960
      • Second support at 17890
    • Resistance
      • First resistance at 18040
      • Second resistance at 18150
  • Bank Nifty
    • Bank Nifty opened slightly lower, consolidated for some time and then picked up strength again to close above its yesterday's high of 18495. Indicates strength
    • It made a strong bullish candle on the daily chart.
    • Support 
      • First support at 38200
      • Second support at 37750
    • Resistance 
      • First resistance at 38800
      • Second cannot predict as of now.
  • FII sold for 278Cr today and DII sold for 741Cr today, a net selling of 1000Cr and the index is still up. As mentioned yesterday, this is retail buying and has to be supported by Institutional investors for it to be sustainable.
  • On the FnO side also the FII unwound longs and created shorts on Index futures. They also sold some calls and bought puts on the index. A consistent stance which is bearish and is coupled by DII selling actually raises some concerns on the sustainability of the current breakout. Lets see...
  • Dollar Index has now breached 94.5 again and while the US yields are marginally below 1.6 now, we are not out of woods.
  • Meanwhile, the Brent oil is near 84 USD and is a concern for our markets. INR has been losing against the Dollar and there has been an increase in gold, indicating some shift towards risk free assets. Time again to be a bit cautious.
  • While I feel the buy on dips theme remains, the markets are over valued in the short term. For return of domestic liquidity, some more dilution may happen before some strong institutional buying comes in. My point is not that markets will turn bearish, it is just that we are at peak valuations and exercising caution is necessary.
  • Trading range of Nifty still remains 17600-18100 and for Bank Nifty it has strong support at 37750 and the upper limit could be around 38800.
  • Bank Nifty has picked up the baton after IT gave up and a reversal of leadership may happen once Bank Nifty sees 38800....

1. FII were net sellers for 278 Cr today, while DII were sellers for 741 Cr. A net selling of 1019 Cr from the institutional side.

2. FII's unwound 8232 longs and created 4269 shorts on the index futures

3. On the option front FII  sold 7495 calls and   sold 271 puts. They also bought 443 calls and  bought 13870 Puts.

4. For next week expiry, Nifty has the highest OI for PE at 17800 followed by 17900 and highest OI for CE is at 18000 followed by 18200. Highest Put writing was seen at 17900 and highest call writing was seen at 18250 levels.

5. For the next week expiry, Bank Nifty has the highest OI for PE at 38000 followed by 37500 and highest OI for CE is at 38500 followed by 39000. Highest Put writing was seen at 38500 and highest call writing was seen at 38600 levels. 

6. Asian markets closed mostly in red and Europe closed in red

7. US markets trading flattish as of now.

8. The breadth of the market was neutral today

9. Nifty opened at 17915 and made an intra day high of 18008 and a low of 17864 before closing at 17991 .The range of Nifty for the day was 144 points.

10. Bank Nifty opened at 38178 and made an intra day high of 38609 and a low of 38144 before closing at 38521 .The range of Nifty for the day was 465 points.

11. US Dollar Index is trading at 94.532

12. Except IT almost all sectors closed in green

13. India VIX reduced to 15.85

14. US 10Y yields are at 1.589

15. Nifty futures saw long buildup

16. Bank Nifty saw long buildup


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