9th May' 2022 (Evening)

9th May' 2022 (Evening)  --  | Written at 11.15 PM |

  • Interesting days these are. Following a deep sell off in the US, our Indices, After a gap down opening on Friday and again another gap down opening today, refuse to fall further during the day.
  • Exceptionally strong buying from the domestic institutions is holding the fall during the day. I felt on both days, the selling may intensify at some point, however, it keeps surprising and for good. Now, god knows why are the domestic institutions buying so much. One reason that i can think of is the interest of retail in Index based ETF. A heavy influx of money in these fund, induces immediate buying.
  • On the other hand there may be some Index management to efficiently manage the Dollars moving out of our markets.
  • Lets look at the levels :
  • Now looking at the levels, the indices have gradually started approaching their major support levels. As mentioned yesterday, Nifty took support from 16150 today and Bank Nifty opened at 34100 and then dipped marginally to rise. The risk reward from here is improving every day. 
  • A leap of faith could actually give a good risk reward to a dare devil who has the courage to go out and buy in this market. I would however, wait to watch a retest of todays lows or the Strong base levels mentioned above.
  • Some stocks i feel have given some indications of picking strength. HDFCBank and Maruti i feel have shown some strength at these levels. LT also is developing a base here. Now, some support from the global markets could provide some impetus to give a pull back.
  • However, the Markets globally do not seem to be in that mood. US is again weak today. Dow as of now is 400 points down and Nasdaq is also 400 points down. Both have reached the critical levels I mentioned earlier. Important to see if these are held or taken down. If some support comes here and we see a stronger close, we may see some pull back tomorrow. If these are breached and a deeper US close is seen today, we may see some pain. Lets see.
  • I will not go into the options OI today as i feel it does not make sense today. While from FII standpoint, there was a reasonable put writing today, so some support may be seen.
  • The Cash selling from FII was usual and Index futures saw some long positions, though the ratio of shorting was much higher.
  • Dollar INdex eased from its high of above 104 and the oil has also eased. This could help us tomorrow. The US 10 Y yields also have inched marginally lower. 
  • All in all, I am optimistic that we may see a pull back tomorrow, though i would wait to watch the US close today and the US futures opening tomorrow, to firm up my view.
  • Short and crisp writing today. Hope it helps.....

1. FII were net sellers for 3361 Cr today, while DII were Buyers for 3077 Cr. A net selling of 284 Cr from the institutional side.

2. FII's created 4991 longs and created 13387 shorts on the index futures

3. On the option front FII  created 17632 short calls and   created 31354 short puts. They also created 47826 long calls and  created 47015 long Puts.

4. For next week expiry, Nifty has the highest OI for PE at 16000 followed by 16200 and highest OI for CE is at 17000 followed by 16500. Highest Put writing was seen at 16000 and highest call writing was seen at 16500 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 36000 followed by 35000. Highest Put writing was seen at 34000 and highest call writing was seen at 35000 levels. 

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

7. US markets trading in red as of now

8. The breadth of the market was extremely weak today

9. Nifty opened at 16227 and made an intra day high of 16403 and a low of 16142 before closing at 16301 .The range of Nifty for the day was 261 points.

10. Bank Nifty opened at 34091 and made an intra day high of 34554 and a low of 33927 before closing at 34275 .The range of Bank Nifty for the day was 627 points.

11. US Dollar Index is at 103.698

12. Except IT, all sectors closed in red today

13. India VIX increased to 220325

14. US 10Y yields are at 3.075

15. Nifty futures saw short buildup

16. Bank Nifty futures saw short buildup

17. US Brent oil eased to 106.43

18. USD / INR eased to 77.421


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