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Market Brief
Today Nifty is likely to open gap down by around 25 points. Thereafter expecting it to remain volatile and choppy in initial hours of trade and likely to trade with negative bias. However we could see recovery in indices and stocks like yesterday. Nifty has immediate support at 5060 and resistance at 5180. We could see rally in stocks of metals, beaten down heavily in last few trading sessions.
Yesterday Nifty started the day with gap down opening of around 80 points. Thereafter Nifty remained volatile and choppy in initial hours of trade. Very soon Nifty started gaining upside momentum gradually. Nifty recovered almost 70 points from day low of 90 points. Finally closed at 5124.90, just 23.60 points down from previous close.
Nifty May future accumulated 4.15 lakh shares in open interest most of them were on short side. Volatility Index (VIX) increased from 23.30 to 23.69 (increase of 1.67%) indicates Nifty is likely to remain range bound in between 5000 and 5200 in short term. High volatility indicates Nifty is likely to trade with negative bias in initial hours of trade in today trading session.
Turnover in F&O segment remained moderate at Rs. 96186.76 crore. Among the options Nifty May 5000 and 5100 call option accumulated 5.38 and 15.58 lakh shares in open interest. On the other side Nifty 4700, 4800and 4900 May put option also accumulated 8.81, 11.20 and 30.23 lakh shares in open interest. From the open interest chart it is indicative that 5000 is strong support in downtrend and 5200 is next immediate resistance for Nifty in uptrend. Nifty is likely to remain in between 5000 and 5200 in short term. If Nifty breaches 5200 mark decisively then we could see further rally upto 5300 mark in forthcoming trading session.
Wednesday May 5, 2010 FII’s were net buyer in F&O segment to tune of Rs. 1630.19 crore while net seller in cash segment worth Rs. 1589.68 crore. They remained net seller in index futures and stock options to tune of Rs. 1039.14 crore and Rs. 15.72 crore and net buyer in index options and stock futures to tune of Rs. 2684.22 crore and Rs. 0.82 crore respectively. Nifty put call ratio increased to 1.16 due to active put writing at 4900 which could act as strong support for Nifty in downtrend.
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