The markets have crashed on a week-on-week basis on negative volumes growth as the players seem to have abstained from big ticket trading in the week gone by. The outstanding net long positions are down approx 5 % on a week-on-week basis. This is a negative development as the bulls show lower risk appetite. The outlook appears to be cautious as the markets are trading below the short term support at the 1964 levels which points towards a possibility of 1905 - 1915 levels if more unwinding occurs. The Nifty January futures trade at Rs 5 discount to cash - as against Rs 4 premium to cash last weekend. The stocks of the week are likely to be NTPC, Reliance Inds & Tisco.

Outstanding positions - week on week

Market internals - outstandings - all Rs crores

Description	Rupees crores	Call options	Put options	Net position
Index Futures	2,621 59
Stock futures	9,345 1347
Index options		1356 344	1151 242	205  102
Stock options		2674 575	533 87	2141  488
Total Futures	11,966 1406	Total options - net	2346 590
Gross longs ( F+O )	15,966 517	Net longs ( F+O )	14,312 816

Observation - The net out-standings have fallen as the above table indicates. This is a negative development as bulls show a lower risk appetite - even at lower levels. Click here to view previous weeks file

Note - Previous weekend gross long positions Rs 16,483 crs, net long positions Rs 15,128 crs.

Source - The National Stock Exchange.

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It maybe noted that FII's now hold approximately Rs 9,353 crs in open interest which is a substantial portion of the entire market open interest. The FII's seem to be concentrating on stock futures and then Index futures in that order of preference. Please note that FII's have bought more futures than they sold on Jan 13, 2005. That indicates a buying bias in the near term. Sales of Re. 1 Crs are seen in the cash segment on that day.

Source - The National Stock Exchange.

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The traded volumes have slumped. The traded turnover was lower in almost all the segments. That is a marginally positive sign as the markets have fallen on lower volumes. We want the volumes and prices to rise in the coming week if the markets are to see retail participation. The combination of traded volumes, open interest and put / call ratios are a reliable indicator of the undercurrents. The outlook appears nervous in the short term. Click here to view previous weeks file

Description	Previous week - Rs. crores	Current - Rs. crores	Change - Rs crores
Index Futures	21,315	20,334	981
Stock futures	45,430	36,018	9,412
Totals - a	66,745	56,352	10,393
Index calls	1,967	2,012	45
Stock calls	3,859	3,418	441
Totals - b	5,826	5,430	396
Index puts	1,636	1,610	26
Stock puts	718	716	02
Totals - c	2,354	2,326	28
Grand totals ( a+b+c)	74,925	64,108	10,817

Source - The National Stock Exchange.

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Nuts and bolts - week on week

Put call ratios

 

PCR - Index	0.87 : 1	Previous week	0.92: 1
PCR - Stocks	0.20 : 1	Previous week	0.21 : 1
PCR - Total	0.23 : 1	Previous week	0.24 : 1

Observation - The PCR shows a tilt towards the bulls as the ratios are showing squaring up of shorts on a week-on-week basis. The Nifty PCR remaining outright bearish, the shorts have seen a marginal fall. The individual stocks show an slight decrease in short positions too. This ( PCR ) will be the one of the most reliable indicator of market trends. The total PCR has remained above the equilibrium point. The equilibrium point is 0.50 : 1. Click here to view previous weeks file

Source - The National Stock Exchange.

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Directional guidance - week on week

Market internals - Nifty put / call trends - 5 highest open interest contracts

Calls	Previous week Rs Crs	Current Rs crores	Change Rs Crs
2100 CE	213	218	05
2000 CE	108	211	103
1950 CE	42	192	150
2050 CE	197	184	13
2150 CE	78	74	04
Puts	Previous week Rs Crs	Current Rs crores	Change Rs Crs
1950 PE	77	191	114
1900 PE	47	187	140
2000 PE	212	171	41
2050 PE	128	97	31
2070 PE	84	83	01

Observation - The index contracts show which way the players are tilting. The outstanding positions seem to have increased in the previous week. The bulls have added Rs 241 Crs - showing a preference between the 1950 - 2000 strikes. Our inference is - watch the 1915 support levels in the coming days. The bears have added Rs. 181 Crs. That shows a tendency towards selling at the 1900 - 1950 strikes. The undertone appears cautious for now. Click here to view previous weeks file.

Source - The National Stock Exchange.

Open interest I FII positions I Volumes I PCR I Nifty puts / calls I open int changes I OI - stocks I Top calls / puts I Volatility I Recos I Print this page I Close Window

Source - The National Stock Exchange.

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The center stage - week on week

5 Highest outstanding scrips

Futures	Previous week Rs Crs	Current Rs. Crores	Change Rs Crs
Reliance	944	847	97
Tisco	961	907	54
NTPC	692	621	71
Infosys	702	599	103
TCS	639	566	73

Options	Previous week Rs Crs	Current Rs. Crores	Change Rs Crs
NTPC 90 calls	116	115	01
NTPC 85 calls	71	92	21
Reliance 540 Calls	63	68	05
Infosys 2100 calls	39	62	23
Tcs 1350 calls	35	61	26

Observation - The action remains polarised around the same big counters - Tisco, Reliance & NTPC. Outstanding open interest in all the stocks has fallen - a negative phenomena. TCS is the new kid on the block. Watch Reliance & Tisco for directional guidance in the coming week.  Click here to view previous weeks file.

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The activity is polarised around the Nifty between the 1900 - 2000 on the long side and ACC, NTPC, SBI, TCS & Tisco in individual stocks.

 

Source - The National Stock Exchange.

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This segment is for paid subscribers only

Open interest I FII positions I Volumes I PCR I Nifty puts / calls I open int changes I OI - stocks I Top calls / puts I Volatility I Recos I Print this page I Close Window

Have a profitable day.

 

Vijay L. Bhambwani

Ceo :- Bsplindia.com

The author is a Mumbai  based investment consultant and invites feedback at Vijay@BSPLindia.com and  (022) 23438482 / 23400345.

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