NIFTY for 9th September

NSE:NIFTY   Nifty 50 Index
On friday, 6th September, based on reports that Finance Minister will again announce some important stimuli, like it had happened on 2 previous fridays, both Nifty and Bank Nifty (BNF) staged a rally. If you see closely, you will find that in first half BNF was pulling Nifty and in later half it was Nifty which was stronger than BNF. Consequently, since I had suggested short strategies in Nifty and BNF, both hit stop losses. But last friday evening, nothing great happened! Rupee closed at 71.725, a recovery of 12 paise. DJIA closed 69 points up which is just OK. So for tomorrow, our market opening will depend on Hang Seng and SGX nifty . My belief is that, since friday's rally was on hope of some announcements which did not happen, Global markets showing status quo, ruppee showing marginal improvement, but FIIs still in 'Sell' mode, we might see some back-tracking in Nifty . Let us see other usual data.
1) FII & DII data: Provisional data suggests that FIIs were Net sellers by 957 Crs and DIIs were Net buyers by 1207 Crs . In absolute figure terms, DIIs bought shares worth 3300 Crs and FIIs sold shares worth 4274 Crs . As per final data submitted for 5th September, FIIs were Net Sellers in Equity by 416 Crs , and in index futures by 955 Crs and net buyers in stock futures by 232 Crs . Note that on both, Thursday and Friday, FIIs were net sellers.
I have no doubt that same will happen on Monday too.
2) Option Chain data: On PUT side, highest total OI (20.97 lakhs) and highest fresh Put writing (11.09 lakhs) both are on 11900 strike. Such high OI and writing is not seen on any other strike even on Call side. Co clearly 10900 looks as strong support for tomorrow. 2nd highest Put writing ( 6.19 lakhs) is at 10850 strike but 2nd highest total OI (16.70 lakhs) is at 10800 strike. So if 10900 crumbles, 10850 will act as next line of defence and if that goes down, 10800 will pitch in. I think 10800 will remain support of this week if everything else ( global markets, rupee, oil & news ) remains as it is today. On CALL side, highest total OI (18.67 lakhs) is at 11000 strike and fresh highest Call writing (4.00 lakhs- much low!) is at 11100 strike. Due to friday's rally, Call writers are on backfoot clearly. If 11000 breaks, the rally might continue well upwards. But I think due to reasons mentioned above, it might not happen. So for tomorrow 10900-11000 looks good trading range.
3) Charts: On friday, Nifty closed as strong green candle with higher high and higher low. this trend is seen for past 2 trading sessions. There are no clear trading levels on chart and hence I have shown resistances and support. R1 is 20 DEMA line at 10980. R2 is at 11048. strategy for tomorrow is to short when it approaches 11000 levels with a SL of 30 points and target of around 70 points. If it falls below friday's close right in the beginning, buying at 10900 can be done but with strict SL of 30 points since predominant trend is down still.
All the best. Happy trading.

Yet another awesome analysis, ji from your end. Nifty came down to 10900 and as you said, huge amounts of buying happened, taking it to 11,000.Also good opportunity for shorting as well. Kudos to your analysis methods.Looks like Nifty could go up 100-150 pts upwards from current levels, in the next few sessions. Ji, awaiting your analysis for Sep 11.
By the way, thanks again!!
@sosmuthu, thanks. Will post for 11th.
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