The markets have rallied higher on a week-on-week basis with a jump in volumes as the players participated aggressive in intraday trades. The outstanding net long positions are up approx 3.7 % on a week-on-week basis. This is a positive development after expiry. The outlook appears to be cautiously optimistic as the markets are trading above the short term resistance at the 2073 levels which points towards a possibility of 2108 / 2122 levels if more buying occurs. The Nifty near month futures trade at Rs 19 discount to cash - as against at Rs 18 discount to cash last weekend. The stocks of the week are likely to remain Reliance Inds, SBI & Tisco.

Outstanding positions - week on week

Market internals - outstandings - all Rs crores

Description	Rupees crores	Call options	Put options	Net position
Index Futures	4,901 155
Stock futures	10,613 899
Index options		1104 241	1318 234	(-) 214 07
Stock options		1349 367	390 126	959  241
Total Futures	15,514 1054	Total options - net	745 248
Gross longs ( F+O )	17,222 917	Net longs ( F+O )	15,514 557

Observation - The net out-standings have risen approx 3.7 % as the above table indicates. This is a positive development after expiry. Click here to view previous weeks file.

Note - Previous weekend gross long positions Rs 16,305 crs, net long positions Rs 14,957 crs.

Source - The National Stock Exchange.

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It maybe noted that FII's now hold approximately Rs 11,990 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 purchased more futures than they sold on June 09, 2005. That indicates a buying bias in the near term. Purchases of Rs. 293 Crs are seen in the cash segment on that day.

Source - The National Stock Exchange.

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The traded volumes have jumped. The traded turnover was higher in almost all the segments. This is a sign of higher retail participation as the rally was on increased 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 cautious in the short term. Click here to view previous weeks file

Description	Previous week - Rs. crores	Current - Rs. crores	Change - Rs crores
Index Futures	13,786	14,177	391
Stock futures	25,294	28,037	2,743
Totals - a	39,080	42,214	3,134
Index calls	1,498	1,544	46
Stock calls	1,837	2,067	230
Totals - b	3,335	3,611	276
Index puts	1,251	1,208	43
Stock puts	436	470	34
Totals - c	1,687	1,678	09
Grand totals ( a+b+c)	44,102	47,503	3,401

Source - The National Stock Exchange.

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Nuts and bolts - week on week

Put call ratios

 

PCR - Index	1.22 : 1	Previous week	1.28: 1
PCR - Stocks	0.27 : 1	Previous week	0.25 : 1
PCR - Total	0.33 : 1	Previous week	0.33 : 1

Observation - The PCR shows a tilt towards the bears as the ratios are showing a slight increase in shorts on a week-on-week basis. The Nifty PCR remaining outright bearish, the shorts have seen a small decrease. The individual stocks show an increase in short positions. This ( PCR ) will be the one of the most reliable indicator of market trends. The total PCR has remained below 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	209	298	89
2050  CE	215	254	39
2000   CE	173	176	03
1950   CE	98	93	05
2150  CE	28	81	53
Puts	Previous week Rs Crs	Current Rs crores	Change Rs Crs
2000  PE	344	406	62
2050  PE	266	328	62
1950   PE	166	169	03
2100  PE	90	125	35
1900   PE	99	101	02

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 179 Crs - showing a preference for the 2050 - 2150 strikes. Our inference is - watch the 2063 / 2077 support levels in the coming days. The bears have increased Rs. 164 Crs. That shows a tendency towards the 2000 - 2100 strikes. The undertone appears cautiously optimistic for now. Click here to view previous weeks file.

Source - The National Stock Exchange.

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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	1209	1087	122
Tisco	918	998	80
ONGC	355	361	06
Infosys	366	377	11
SBI	463	469	06

Options	Previous week Rs Crs	Current Rs. Crores	Change Rs Crs
RELIANCE 560  calls	56	71	15
TISCO 360 calls	46	54	08
RELIANCE 540 Calls	57	52	05
TISCO 350 calls	37	45	08
NTPC 90 calls	21	44	23

Observation - The action remains polarised around the same big counters - Tisco, Reliance & NTPC. Outstanding open interest in all the stocks has risen - a routine phenomena after expiry. 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 2000 - 2150 on the long side and NTPC, Reliance Inds, SBI & 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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