The markets traded rangebound throughout the day and closed with moderate gains. Capital goods and FMCG were the best performers in today's session while realty, auto, consumer durables and power remained the biggest laggards. The Sensex closed at 16880, up 18 points from its previous close, and the Nifty closed at 5121, up 5 points.
Nifty future closed at 5123 -0.07% while nifty spot closed at 5121.45 up by 5.55 points by 0.11%. first indication it gives us that some part of profiting booking has done today. Who booked profit today,----- lets go ahead and consider data. Fii bought 1077 crores in Index future and open interest increased but negative by 2.87%, while Fii bought 43618 contracts of nifty future. Then how open interest is negative. Let me explain, Yesterday nifty future premium was 10 points and todays nifty future premium is 1.55 points only. profit booking by retail investors in nifty future made its open interest negative. But smart money is still being long even before inflation data on Thursday.
Now lets consider option data.
Nifty 5100 put added 411450 contracts in open interest and 5100 call decreased by 55600 contracts from open interest. Nifty 5200 call added huge open interest by 653400 with total highest open interest 6513350, Indicating that 5100-5090 will form strong support and 5200 range will create problems for bulls.
As per slow stochastic on EOD daily charts it is showing some overbought. Again range bound trading expected tomorrow. Nifty has given two days closing above 50 and 200 day moving averages and above falling trendline also.
I came to conclusion after putting all report that overall positive trend will remain until nifty is above 5090 level. Below 5090 level bears will come for batting. If nifty come around 5000 level can do fresh buy with stoploss at 5070 level. But if nifty does not cross 5155 level tomorrow will be not a good sign for bulls. If inflation data come with increased in number on Thursday can blow water on every expectation that Rbi will cut rate. Under this situation nifty may slip to 4700-4600 level within a week. Keeping long position without hedging will be very very risky.
