The markets have fallen approximately 1.4 % on a week-on-week basis on lower volumes growth as the players seem to have abstained from buying at higher levels. The Outstanding net long positions are up approximately 2 % on a week-on-week basis. This is a neutral development as the OI has increased in the options segment which shows a lower risk appetite amongst the traders. The outlook appears to be cautiously optimistic as the markets are below a short term support at the 1802 levels which if violated on a continous close basis, will see 1764 levels. The Nifty futures trade at Re 4 discount to cash. The stocks of the week are likely to be Reliance, TCS & Tisco.

Outstanding positions - week on week

Market internals - outstandings - all Rs crores

Description	Rupees crores	Call options	Put options	Net position
Index Futures	2,063 37
Stock futures	6,708 23
Index options		635 67	753 13	(-) 118  54
Stock options		1608 326	485 96	1123  230
Total Futures	8,771 14	Total options - net	1005 284
Gross longs ( F+ O )	11,014 407	Net longs ( F+ O )	9,776 198

Observation - The net out-standings have increased as the above table indicates. This is a neutral development as the increase is in the options segment - showing a lower risk appetite. Click here to view previous weeks file

Note - Previous weekend gross long positions Rs 10,607 crs, net long positions Rs 9,578 crs.

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

It maybe noted that FII's now hold approximately Rs 5,955 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 marginally more futures than they have bought on Oct 14, 2004. That indicates a wait and watch approach in the near term. Purchases of Rs 175 crs are seen in the cash segment on that day.

`Source - The National Stock Exchange.

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The traded volumes have slumped - although a fair comparison is not possible as the recent week was a short one, due to a holiday on Oct 13, 2004. The traded turnover was lower in all the segments. We want the volumes 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 cautiously optimistic in the short term. Click here to view previous weeks file

Description	Previous week - Rs. crores	Current - Rs. crores	Change - Rs crores
Index Futures	11,844	9,435	2,409
Stock futures	29,595	20,730	8,865
Totals - a	41,439	30,165	11,274
Index calls	1,139	843	296
Stock calls	3,045	2,465	580
Totals - b	4,184	3,308	876
Index puts	827	651	176
Stock puts	641	634	07
Totals - c	1,468	1,285	183
Grand totals ( a+b+c)	47,091	34,758	12,333

Source - The National Stock Exchange.

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Nuts and bolts - week on week

Put call ratios

 

PCR - Index	1.20 : 1	Previous week	1.14: 1
PCR - Stocks	0.28 : 1	Previous week	0.29 : 1
PCR - Total	0.33 : 1	Previous week	0.35 : 1

Observation - The PCR shows a tilt towards the bears as the ratios are showing bearish activity building up on a week-on-week basis. The Nifty PCR remaining outright bearish, the shorts have risen faster than the longs. The individual stocks show a marginal increase in long positions. This ( PCR ) will be the one of the most reliable indicator of market trends. The total PCR has remained positive. 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
1800 CE	147	160	13
1830 CE	74	77	03
1700 CE	64	63	01
1770 CE	59	58	01
1750 CE	70	68	02
Puts	Previous week Rs Crs	Current Rs crores	Change Rs Crs
1770 PE	86	109	23
1750 PE	104	141	37
1650 PE	48	49	01
1700 PE	104	105	01
1800 PE	169	193	24

Observation - The index contracts show which way the players are tilting. The outstanding positions seem to have increased all round in the previous week. The bulls have added Rs 12 Crs. Our inference is - watch the 1780 support levels in the coming days. The bears have added Rs 86 Crs. That shows a tendency towards building up shorts at the 1750 - 1830 strike price. The undertone appears optimistic 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
Tisco	789	708	81
TCS	566	564	02
Reliance	384	373	11
Infosys	434	323	111
SBI	358	359	01

Options	Previous week Rs Crs	Current Rs. Crores	Change Rs Crs
Tcs 1140 calls	21	44	23
TCS 1100 calls	53	46	07
Reliance 560 Calls	24	41	17
Tisco 290 calls	32	52	20
Tisco 300 calls	70	85	15

Observation - The action remains polarised around the same big counters - Tisco, Reliance, TCS & SBI. Outstanding open interest in most of the stocks has fallen - a negative phenomena. Watch 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 1800 - 1830 on the long side and Satyam Computers, TCS, Reliance & 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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