ANALYSIS

2 aug 2021

As on 2nd August 22:20 hrs

Global Cues

  • Dow up by 31 pts

  • European markets are positive

  • S&P VIX up by 0.71%

  • US 10 yrs bond is at 1.176 (down 5.12%)

  • US dollar index is at 91.99

  • Brent crude is at 72.92 USD


Data – Global data looks positive


Today’s Market Analysis


Technical Chart and Price Action

The index opened more than 100 points up at 15,874.90 and remained in the range on the higher side. It touched an intraday high of 15,892.90 and low of 15,834.65, before ending the session at 15,885.20, up 122.20 points. It formed a bullish candle that resembled a Hanging Man pattern on the daily chart. The immediate support is at 15848 and immediate resistance is at 15907. Nifty needs to break 15900 level convincingly to create a strong up trend. If it breaks 15840 and sustains there then we can expect the volatility to increase a lot. India VIX remained flattish today at 12.81. The global queues are positive and SGX Nifty also indicates a gap up opening tomorrow as of now. Overall data looks bullish.


Option Chain Data Analysis

Today put writing is seen to be heavier than call writing after a long time. Huge put writing was seen at 15800 (32.3 Lakhs) followed by 15900 (19.1 Lakhs) and 15850 (15.9 Lakhs). On the call side highest writing was seen at 16000 (10.4 Lakhs) followed by 15900 (8 Lakhs) and 16050 (8.7 Lakhs). Overall highest call writing is standing at 15900 (51 Lakhs) and on the put side it is at 15800 (58.3 Lakhs). On the monthly OI chart huge put addition was seen at 15000 (18.3 Lakhs). On the weekly chart of 5th Aug expiry, call unwinding was seen at 15800 level and below. Overall option chain data looks bullish


Put Call Ratio

1.03 – Bullish


Max pain

15800 – Bearish


FII Activity in Options

Put shorts increased by 26% and Put longs increased by 13%, Overall, 783 more put contracts shorted –Slightly Bullish


Call shorts increased by 23% and call longs increased by 38%, Overall, 58749 more call contracts longed – Bullish


FII Activity in Index Future

Net long decreased by 1% to 61%. –Neutral


FII Activity in cash market

FII sold 1539.88 Cr and DII bought 1505.82 crores – Neutral


Take-away and Trade Plan

Global queues are positive and overall index position is observed to be bullish. Option chain also indicates a move towards 15900. At 15900 there will be a considerable resistance keeping in mind the huge call writers present there. ATM IV has slightly increased to 11.5 but premium’s are still low. As of now the monthly range still stands at 15000 PE and 16000 CE. Though for weekly trade, there is a chance that 16000 can be broken. Wait for Nifty to break 15900 level decisively before creating long positions. Overall the data looks bullish for the weekly expiry. Trade cautiously.