Carnage on D-Street, FII FnO Analysis for 5 April Trade in Nifty and Bank Nifty Future


  • FIIs sold 35017 Contracts of Index Future (NSE Nifty Futures and Bank Nifty Futures combined),worth 985 cores with net Open Interest increasing by 28883 contracts. FII added more  shorts  in Index Futures as net OI rose with price. How to manage Commodities Trading Account .
  • Nifty has fallen 189 points in matter of 2 days biggest decline in 14 months, Nifty opened gap down of 32 points  near 200 DMA@5637 and there after just kept on sliding down closed near the lows of the day. 33 Index stocks out of 50 are trading below 200 DMA, what was more concerning was today’s fall was led by IT stocks which were the perfect hideout for Bulls in past 2 months. Selling in most over owned stocks shows panic among market participants. Again,would request readers please do not speculate on Bottom of Nifty and think of going long thinking market cannot fall below this, We do not control market, Market control us. Get Used to This fact and do not go for adventurous longs till we get confirmation.

200 DMA

  • Today’s decline with the formation of downside gap of around 32 points seems to be a formation of bearish breakaway gap . If this gap gets confirmed in the next 1-2 sessions without getting filled, then it could lead to significant declines from here. Similar Bullish  Breakaway gap on Upside was formed in September 5447-5526 and Nifty made a High of 6112 in 5 months time frame. So this gaps need to be watched closely.
  • Nifty Future March Open Interest Volume is at 1.56 cores with addition of 11.5  lakh in Open Interest with increase  in Cost of Carry of Nifty Future  to showing traders have short  positions .
  • Total Future & Option trading volume at 1.48 lakh Cores with total contract traded 2.77  lakh , Cash market volumes were below avearge on a day when Nifty fall below 200 DMA , suggesting no delivery based selling has started. PCR (Put to Call Ratio) at 0.90  and VIX at 15.85
  • 5700 Nifty CE  is having highest OI at 70.4 Lakh with addition of  21.4 Lakhs,  so 5700 remains  key resistance.5600 CE also added 21 lakhs in OI with net OI at 38.5 lakhs, 5400-6000 CE added huge 64 Lakhs in OI
  •  5600 Put Option is having highest  Open Interest of  70 lakhs with liquidation of  13.2 lakhs in OI, traders betting Nifty will take support of 5600 were forced to square of the position  ,5700 PE liquidated  10.9  lakhs and net OI at 43.6 lakhs, 5400 PE added another 5lakhs and 5500 PE added 6.2 lakhs suggesting base now shifting to 5500 .5400-6000 PE liquidated  24  Lakhs in OI
  • Nifty Futures Trend Deciding level is 5593 (For Intraday Traders). Nifty Trend Changer Level 5698, Bank Nifty Trend Changer Level 11396. We got short entry yesterday In Nifty and Bank Nifty, almost 150 points gain in Nifty and 300 Points in BN partial profit booking is advisable.


Buy above 5595 Tgt 5620, 5644,5673(Nifty Spot Levels)

Sell below 5566 Tgt 5550,5525 and 5500(Nifty Spot Levels)

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  1. Su Saravana Perumaal said:

    Thank you Sir for Ur clarification

    April 5, 2013
  2. Su Saravana Perumaal said:

    I am a regular reader of your analysis. Good analysis and very informative. I have a doubt: Gaps provide Support and Resistance. Can we expect support from the earlier “Bullish Breakaway Gap” or the Prevailing down trend from 6112 should be considered? Technical Analysis, is Reality (Dr Alexander Elder). Does it mean, the Prevailing Trend takes priority?

    Kindly clarify

    Su Saravana Perumaal

    April 4, 2013
    • Bramesh said:

      Thanks a Lot !!

      Gaps do provide S&R but that happens with common gaps which gets filled.

      I have mentioned if the gap does not get filled in next 1-2 days it increases the probability of being a breakaway gap.Now the Bullish Breakaway gap has done its job, trend is down now and fall can take support at 5525,and can see a minor pullback. Next week trading will give the final answer to this mystery.


      April 4, 2013

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