NIFTY for 16th AugustWe are moving from FALL to CONSOLIDATION it seems, provided world markets remain the way they are- and that's a big challenge! Trump is tweeting day in and day out and American markets are reacting or overreacting to every piece of news or data. Yesterday Dow Jones lost 800 points because 10 year bond yield curve dipped below 2yr bond yield curve. And if you are thinking what's the big deal, then whenever this has happened (7 times) since 1969, America went into recession a year or two later. So DJIA even today is not looking to recover from yesterday's low. At the time of writing this piece, it is 26 points down. Let's look at our data points now.
1) Provisional data show that both FIIs and DIIs were Net buyers by 1615 Crs and 1620 Crs respectively. The final data, however, show that FIIs were Net Sellers in Equity by 540 Crs, in index futures by around 153 Crs and in stock futures by 970 Crs. So it shows FIIs did sell but volume looks smaller to me as compared to earlier figures.
2) Option chain data, expiry 22nd August, show on PUT side total highest OI (9.63 lakhs) and fresh highest Put writing (7.90 lakhs) at 11000 strike. Comparable figures are at 10900 strike and since Nifty closed at 11029 (quite near 11000), we can safely assume that both 11000 and 10900 will act as good supports. On CALL side, total highest OI (9.07 lakhs) and fresh highest Call writing (6.06 lakhs) at 11200 strike. Data is yet to be populated but as of now 11200 can be seen as credible resistance.
3) On charts, Nifty closed with lower high and higher low finishing as a Doji candle. Till it breaks 13th August low of 10901, it will not fall further. So that is our lower limit. Our upper limit is at 21 day DEMA of 11667. The buying area and selling area shows where we can take long and short trades with good RR. whether we open Gap up or down will be dictated by tonight's DJIA and tomorrow's Hang Seng & SgX movements.
all the best. Happy trading.
