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Published on 18/09/2019 10:01:00 AM | Source: Geojit Financial Services Ltd

Premium marginally rose to 15.9 points from previous day`s 13.7 points - Geojit Financial

F&O OUTLOOK

Review

Nifty index futures closed 1.67% lower at 10833.50 on Tuesday. Sep month open interest increased by 3.13 lakh shares indicating short build up in the markets. Premium marginally rose to 15.9 points from previous day's 13.7 points. Hefty covering of Put longs in the ATM and near OTM strikes helped the PCR to decline to 0.99 from 1.17 on Tuesday. Nifty volatility index, VIX surged 7.12% to 16.0175 from 14.9525.

 

FIIs seen raise positions in index future longs

Though on Monday, FIIs had piled on negative bets along calls, options as well as futures, yesterday’s sharp fall has allowed them to tone down such negativity. This was visible in increase in OI of index future longs by 23.8 percent. However, the next major increases came along Index call shorts and index put longs, by 27,837 and 40,372 contracts respectively, clearly indicating that FIIs continue to pursue more downsides.

 

Nifty outlook : Expect a dead cat bounce

OTM calls which had seen buying in the last few days are now witnessing sharp long liquidation. Along puts, interest is shifting to OTMs, with shorts shifting out of 11,100, 11,000 and 10,900 strikes. The increase in index futures point to a possible bounce back, but option positioning suggest that such a pullback could turn into a dead cat bounce, leading to more downsides in the coming days, unless 11,100 is cleared on the way up.

 

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