Today I felt like writing an obituary... of indian stock market! I wrote yesterday that it would fall even today based on data and indicators that were available, least did I know the fall would be so severe. And if you see the list of Nifty losers, the highest loser Yes Bank fell by 13.9%, 2nd, Vedanta by 7.8 % and 3rd, Indiabull housing by 6.8%. The High weightage stocks like Reliance fell by 1.9%, HDFC by 2.55% and HDFC Bank by 2.32%. See the severity of fall in Nifty stocks. On what basis, any buyer would muster any courage to buy anything, even for long term? Because nobody knows when and where it will stop. Let us see what we have for tomorrow.
1) FII & DII data: According to provisional figures, FIIs/FPIs were Net Sellers by 903 Crs and DIIs were Net Buyers by 1719 Crs. Then why did market fall so much. The absolute figures show, provisional data of course, FIIs sold shares worth 6248 Crs and DIIs bought shares worth 4967 Crs. And that explains why markets were deeply negative. Let's move to final data from NSDL: FIIs were Net sellers in Equity by 1044 Crs (in Secondary market sold 702 Crs & in primary markets sold 342 Crs), in index futures by 137 Crs and in stock futures by 328 Crs. All Net Sale figures! FIIs are still selling and if we relate to fall in bigwigs like Reliance, HDFC, etc., it seems to me now that they have started selling stocks they wanted to hold.People who read my post regularly would remember that for past few days I wrote that FIIs want to sell but are not finding stocks to sell and what they are holding they want to hold. Today that faith is shaken. It reflects on chart as well- I will talk about when I write charts section. Conclusion- Still no sign at all that fall will not continue and this should be wake up call for govt. For us traders- Short & Sell. Short and Sell if you want to make money.
2) Option chain data: Expiry 29th August; Actually there is good & impressive build up of OI on both sides considering that week ending 29th August will start tomorrow. Obviously, this will be watershed week. On PUT side, highest total OI (25.19 lakhs) is on 10500 strike and fresh highest Put writing (3.90 lakhs) is at 10700 strike. On 10600 strike there is Put unwinding and lesser OI. For tomorrow, I will treat 10700 as weak support because of highest writing and 2nd highest OI. On CALL side, highest total OI (45 lakhs) and highest Call writing (11.62 lakhs) both are at 11000 strike. That is too high and we will see Call unwinding on this strike and further call addition on lower strikes as focus will shift on this series tomorrow onwards. 2nd highest total OI is (20.68 lakhs) at 10900 but 2nd highest Call writing (9.64 lakhs) is at 10800 strike. Compare the figures of OI and writing on both sides. So for tomorrow, 10800 serves me as decent resistance since market is bearish.
3) Charts- If you see on daily chart, Nifty is showing red candles with increasing size of bodies with every session. Meaning the intensity of fall was bigger today than yesterday and yesterday's candle was bigger than day before yesterday! what that means is - Momentum is now increasing! And now I will tell you 3 big points which I observed which will further shock the readers.
(a) On weekly chart, today Nifty closed below below 61.8 % Fibonacci level. Traders do believe that if some stock/index is closing below 61.8% then trend changes. So we might be heading into larger bear phase now.
(b) On weekly chart too, It also dipped below weekly Demand Zone (10863-10729) which I wrote about yesterday, but didn't close below 10729.
(c) On daily chart, It also closed below 5th August low of 10782.6, from where Nifty reversed last time and started going up.
So now I will repeat what I said earlier- Momentum is increasing. There is no sign of any reversal. The shorting levels are given on chart.
All the best and happy trading.
1) FII & DII data: According to provisional figures, FIIs/FPIs were Net Sellers by 903 Crs and DIIs were Net Buyers by 1719 Crs. Then why did market fall so much. The absolute figures show, provisional data of course, FIIs sold shares worth 6248 Crs and DIIs bought shares worth 4967 Crs. And that explains why markets were deeply negative. Let's move to final data from NSDL: FIIs were Net sellers in Equity by 1044 Crs (in Secondary market sold 702 Crs & in primary markets sold 342 Crs), in index futures by 137 Crs and in stock futures by 328 Crs. All Net Sale figures! FIIs are still selling and if we relate to fall in bigwigs like Reliance, HDFC, etc., it seems to me now that they have started selling stocks they wanted to hold.People who read my post regularly would remember that for past few days I wrote that FIIs want to sell but are not finding stocks to sell and what they are holding they want to hold. Today that faith is shaken. It reflects on chart as well- I will talk about when I write charts section. Conclusion- Still no sign at all that fall will not continue and this should be wake up call for govt. For us traders- Short & Sell. Short and Sell if you want to make money.
2) Option chain data: Expiry 29th August; Actually there is good & impressive build up of OI on both sides considering that week ending 29th August will start tomorrow. Obviously, this will be watershed week. On PUT side, highest total OI (25.19 lakhs) is on 10500 strike and fresh highest Put writing (3.90 lakhs) is at 10700 strike. On 10600 strike there is Put unwinding and lesser OI. For tomorrow, I will treat 10700 as weak support because of highest writing and 2nd highest OI. On CALL side, highest total OI (45 lakhs) and highest Call writing (11.62 lakhs) both are at 11000 strike. That is too high and we will see Call unwinding on this strike and further call addition on lower strikes as focus will shift on this series tomorrow onwards. 2nd highest total OI is (20.68 lakhs) at 10900 but 2nd highest Call writing (9.64 lakhs) is at 10800 strike. Compare the figures of OI and writing on both sides. So for tomorrow, 10800 serves me as decent resistance since market is bearish.
3) Charts- If you see on daily chart, Nifty is showing red candles with increasing size of bodies with every session. Meaning the intensity of fall was bigger today than yesterday and yesterday's candle was bigger than day before yesterday! what that means is - Momentum is now increasing! And now I will tell you 3 big points which I observed which will further shock the readers.
(a) On weekly chart, today Nifty closed below below 61.8 % Fibonacci level. Traders do believe that if some stock/index is closing below 61.8% then trend changes. So we might be heading into larger bear phase now.
(b) On weekly chart too, It also dipped below weekly Demand Zone (10863-10729) which I wrote about yesterday, but didn't close below 10729.
(c) On daily chart, It also closed below 5th August low of 10782.6, from where Nifty reversed last time and started going up.
So now I will repeat what I said earlier- Momentum is increasing. There is no sign of any reversal. The shorting levels are given on chart.
All the best and happy trading.