17th May' 2022 (Evening)

17th May' 2022 (Evening)  --  | Written at 11.00 PM |

  • Finally that much awaited pull back came today. The Indices gave a sharp pull back of 400 points on Nifty and 700 points on Bank Nifty. With two successive green candles Bank Nifty has actually recovered 1300 points.
  • Nifty was hovering its previous lows of  March and Bank Nifty was also getting closer to the March lows. I had mentioned in the previous notes that a leap of faith can be taken for a bounce back of 250 points. It actually came in for 400 points. Almost similar for Bank Nifty. 
  • I mentioned yesterday, that Bank Nifty was a surprise. I has expected a little more fall before this pull back, but then that is what the markets are known for, Giving surprises.
  • Lets look at how the levels look like :
  • While both the indices have risen sharply, I feel they are not out of the woods. The first level i mentioned for Nifty was 16100. This has been taken down. The next level is now 16325 (Actually 16400). If this is not topped, we may see some weakness again. I somehow feel that the Indices still need to go below 16650 at least once. This view will be negated if we manage a close above 16400.
  • Bank Nifty may give some more surprise, Banking stocks, especially SBI, Kotak and many smaller banks surprised yesterday. Probably driven from the interest of rate rise regime kicking off.
  • There has been a sharp reversal across indices.  While, Nifty shows 16400 as the critical level, these sectoral indices show a reasonable upside in this pullback. This may give strength to Nifty and we may see a inertia jump above 16400. Normally these jumps are sold off. A slow rise and come consolidation at these levels would play healthy. Lets see how does this play out.
  • FII sold off again today for 2192Cr and DII bought for 2294Cr. However, on the Index futures, the FII unwound both longs and shorts on the Index futures. They however, unwound large number of shorts than longs. 
  • This could be driven from the fact that the pull back was on the cards. They however, have not added any major longs, so sustainability of this pull back could be questionable. We have been following global cues a lot lately, so keep an eye on the US markets. as of now they are in green. Keep watching where do they close today and also how the US futures behave tomorrow morning.
  • The Dollar Index has eased slightly and the Yields have also eased a bit. The oil prices are stable at 114 USD. Giving discomfort to us.
  • Options OI indicate a good amount of put writing and show a range of 16000 to 16500 for Nifty and 34000- 35000 for Bank Nifty.

1. FII were net sellers for 2192 Cr today, while DII were Buyers for 2294 Cr. A net buying of 102 Cr from the institutional side.

2. FII's unwound 1297 longs and unwound 13918 shorts on the index futures

3. On the option front FII  unwound 16407 short calls and   created 80406 short puts. They also created 35825 long calls and  created 48001 long Puts.

4. For next week expiry, Nifty has the highest OI for PE at 16000 followed by 15500 and highest OI for CE is at 16500 followed by 16200. Highest Put writing was seen at 16000 and highest call writing was seen at 16600 levels.

5. For the next week expiry, Bank Nifty has the highest OI for PE at 34000 followed by 33000 and highest OI for CE is at 34500 followed by 35500. Highest Put writing was seen at 34000 and highest call writing was seen at 35500 levels. 

6. Asian markets closed mostly in green and Europe also trading in green

7. US markets trading in green as of now

8. The breadth of the market was extremely strong today

9. Nifty opened at 15912 and made an intra day high of 16284 and a low of 15900 before closing at 16259 .The range of Nifty for the day was 384 points.

10. Bank Nifty opened at 33796 and made an intra day high of 34366 and a low of 33680 before closing at 34301 .The range of Bank Nifty for the day was 686 points.

11. US Dollar Index is at 103.392

12. Led by metals, Energy and Auto almost all sectors closed in green

13. India VIX eased to 22.7425

14. US 10Y yields are at 2.973

15. Nifty futures saw long buildup

16. Bank Nifty futures saw long buildup

17. US Brent oil eased to 114.19

18. USD / INR increased to 77.494


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