Below is my Interpretation of FII OI data Sheet for 12-Jan-11.
1. FII sold 4203 Contracts in NF worth 114.54 Cores in Index Futures with Open Interest increasing by 4807 contracts.
2. As Nifty Future was down by 20 points and OI has increased today, with fall in price so FII have booked profit in Index futures.As we have discussed 2 days before No shorts above 4800 Click on Link to read and today also we saw a dip near 4800 and it got bought into.
3. Today we were expecting a wild volatile day it did happened but sad part we neither got a breakout above 4883 nor a breakdown below 4800. Infy gave a good results as per market expectation but there dollar guidance was well below market expectation, If we dig down number basically they are expecting a growth of 0-0.2% in April Quater in Dollar terms so the reason Infy took a beating today and it can go on for next 2-3 days.
4. IIP number were a surprise on Upside with 5.9% as compared to Oct down number of -5.5%. It’s a swing of 11% MoM basis but still Nifty corrected. Oct 2011 number are usually low as we have festival holidays. Higher IIP numbers also means that there will very less probablity of any rate cut in Jan 24 meeting of RBI
5. Tomorrow we have weekly closing Short term trend is up so Bulls will try to close Nifty on Higher end. Close above 4869 will turn the weekly trend up and close below 4776 will turn the weekly trend down. So these 2 levels needs to be watched closely.
6. NF total OI was at 2.14 cores with just 36 k addition in OI longs so longs were held by retailers and HNI. FII OI 493499 is highest in series till date.
7. In Equity cash segment FII bought 506 cores whereas DII sold whopping 996 cores. I think many MF guys exited out of Infosys.Not a Rule but general observation DII mostly sell in Top end of cycle.
8. As per Options data 5000 CE has highest OI of 76 lakhs addition of 7.6 lakh and 4500 PE has highest OI of 72 Lakhs addition of 1 Lakh. 4700 PE is also having a total OI addition of 71 lakhs.
9. Who is benefited from this ranged moved ie Nifty grinding between 4800-4880 Its the Option Writers,both 4800 PE and CE saw a fall in price, Such grinding moves writers will eat premium of both call and puts.
10. One intresting observation FII were buyers in Option in tune of 623 cores and Today 4500 PE has shown an addition of 98K so smart money can use 4500 PE to hedge longs and fresh buying as nifty looks exhasuted on Upside. As 4500 PE is trading at rs 8 so can be a good risk to reward trade if 4800 gets broken
11. FII SAR level comes at 4816 and Nifty ATP for Dec series comes at 4761.
12. Bulls need to close above 4883 level tomorrow as it being 61.8% retracement of 4532-5100. In past Nifty has corrected from 61.8% fibo levels and this level of 4883 will be watched closely tomorrow trading. Nifty has formed a lower high and lower low today.
Buy above 4838 Tgt 4869,4883,4910
Sell below 4800 Tgt 4769,4735 and 4705
All levels mentioned are SPOT levels.
Let me go by Disclaimer these are my personal views and trade taken on these observation should be traded with strict Sl
Follow on Facebook during Market Hours: http://www.facebook.com/pages/Brameshs-Tech/140117182685863