The markets have crashed on a week-on-week basis with a slide in volumes as the bulls abstained from big ticket trades. The figures are not a fair comparison as the week was a short one due to a holiday. The outstanding net long positions are down approx 2.5 % on a week-on-week basis. This is a negative development as the bulls show a lower risk appetite. The outlook appears to be cautious as the markets are trading below the short term support at the 2035 levels which points towards a possibility of 1970 - 2000 levels if more selling occurs. The Nifty March futures trade at Re 1 premium to cash - as against at Rs 4.50 premium 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	3,433 160
Stock futures	9,675 803
Index options		1446 184	1796 54	(-) 350  238
Stock options		2489 292	705 56	1784  348
Total Futures	13,108 963	Total options - net	1434 586
Gross longs ( F+O )	17,043 487	Net longs ( F+O )	14,542 377

Observation - The net out-standings have fallen as the above table indicates. This is a routine development ahead of impeding expiry. Click here to view previous weeks file

Note - Previous weekend gross long positions Rs 17,530 crs, net long positions Rs 14,919 crs.

Source - The National Stock Exchange.

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It maybe noted that FII's now hold approximately Rs 11,489 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 sold more futures than they bought on Mar 23, 2005. That indicates a selling bias in the near term. Sales of Rs. 131 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. The figures are not a fair comparison as the week was a short one due to a holiday. 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	17,004	16,892	112
Stock futures	35,685	28,101	7,584
Totals - a	52,689	44,993	7,696
Index calls	1,772	1,657	115
Stock calls	3,160	2,198	962
Totals - b	4,932	3,855	1,077
Index puts	1,717	2,066	349
Stock puts	932	1,023	91
Totals - c	2,649	3,089	440
Grand totals ( a+b+c)	60,270	51,937	8,333

Source - The National Stock Exchange.

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Nuts and bolts - week on week

Put call ratios

 

PCR - Index	1.26 : 1	Previous week	1.50: 1
PCR - Stocks	0.26 : 1	Previous week	0.32 : 1
PCR - Total	0.32 : 1	Previous week	0.39 : 1

Observation - The PCR shows a tilt towards the bulls as the ratios are showing a decrease in shorts on a week-on-week basis. The Nifty PCR remaining outright bearish, the shorts have seen a slight decrease. The individual stocks show a sizeable decrease in short positions too. 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	373	361	12
2150  CE	329	271	58
2050  CE	137	193	56
2000  CE	39	91	52
2050  CE April	14	51	37
Puts	Previous week Rs Crs	Current Rs crores	Change Rs Crs
2100  PE	670	582	88
2050  PE	402	300	102
2000  PE	230	261	31
2150  PE	144	125	19
1950  PE	84	95	11

Observation - The index contracts show which way the players are tilting. The outstanding positions seem to have decreased in the previous week. The bulls have added Rs 75 Crs - showing a preference for the 2000 - 2050 strikes. Our inference is - watch the 2000 support levels in the coming days. The bears have reduced Rs. 167 Crs. That shows a tendency towards selling at the 1950 - 2000 strikes. The undertone appears cautious 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	906	868	38
Tisco	1202	1169	33
NTPC	452	418	34
Infosys	437	443	06
SBI	647	478	169

Options	Previous week Rs Crs	Current Rs. Crores	Change Rs Crs
NTPC 95 Calls	97	89	08
NTPC 100 calls	66	63	03
RELIANCE 600 calls	66	64	02
NTPC 90 calls	58	70	12
TISCO 440 calls	56	55	01

Observation - The action remains polarised around the same big counters - Tisco, Reliance & NTPC. Outstanding open interest in most of the stocks has fallen - a routine phenomena ahead of expiry. Infosys 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 2000 - 2100 on the long side and Reliance Inds & 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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