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Thursday, July 12, 2007

Daily Strategist Note


The NIFTY futures saw a rise of 1.27% in OI with lower opening but later on recovered and closed almost flat indicating that lot of short positions built  up in the initial hours of trade but later on  market remained flat indicating that if it sustains above 4380 levels we may see shorts covering their positions in the market thus one should not make aggressive short positions in the market.  The Nifty July series futures discount came from 14 points to 1 point indicating shorts covering their positions and fresh long positions built up at lower levels.  The FII were sellers in index futures to the tune of 654 crs and buyers in index options to the tune of 255 crs indicating hedged positions built up by them.  The PCR has remained unchanged to 1.55 levels indicates strength may be seen in the market at current levels. IV in the market was 23.65 and HV was 16.34.
 
Among the Big guns, ONGC saw 0.29% drop in OI with prices coming up indicating buying emerging at lower levels in the counter suggesting some strength may be seen in the stock.  RELIANCE  saw flat OI with prices almost flat  indicating some consolidation may be seen in the stock before any sharp direction o either side.
 
In the TECH counters INFOSYSTCH saw rise of 6.22% OI with prices negative but later on remained flat indicating lot of short positions built up in the counter indicating that if the counter sustains at current levels we may see aggressive short covering.  TCS, & SATYAMCOMP saw drop in positions with prices down  thus suggesting liquidation of long  positions I the counter suggesting some profit booking may be seen in these stocks.
 
In the CEMENT  counters ,  ACC saw rise of  4.74 %   in OI with  prices moving up suggesting long positions built up in the counter suggesting strength may be seen in the stock.  INDIACEM saw rise in OI with prices marginally up indicating    buying emerging in the counter and we may see some consolidation at current levels. GUJAMBCEM saw built up in OI with prices coming down indicating short positions built up in the counter suggesting some weakness may remain in the counter.
 
In the Metal pack, TATASTEEL & JSWSTEEL saw rise in OI with prices positive suggesting further strength may be seen in the counter. SAIL saw rise in OI with prices up indicating fresh long positions built up in this stock suggesting further strength may be seen.  HIINDALCO saw rise in   OI with prices flat indicating some consolidation may be seen in the counter.  NATIONALUM saw 2.38% rise in OI with prices positive suggesting fresh buying emerging thus indicates of further strength.  STER  saw rise in OI with prices coming down indicating built up of short positions in the counter suggesting some weakness may be seen.
 
We feel that the volume and built up in OI suggests that market may show some volatility with positive bias in the coming days and market is having support around 4350 levels. One should trade with strict stop losses to be adhered too as market is at all time high.