Finally the day of results has come for Delhi, which has seen almost a month of polarizing campaign where Shaheen bagh has been the center of attraction. On one hand there are people who say that its just a small city state election, while others put a lot of importance to the result and attach a national importance to it. But how market treats the event today will be known to us all in the next couple of hours time.
The corona virus scare has spread to countries outside China as deaths were reported outside and that affected markets during early part of the day, but US recovered late night to close almost 200 points higher. Asia today is looking positive as it brushed aside the fears of corona for today and Hong Kong up 400 points and Japan closed for the day.
On the domestic front, Delhi elections will be the focus for the market for the first two hours and then the focus will shift to global factors especially the global positive sentiment and gush of liquidity. US markets are back to all time highs and its quite natural that we will also move the same direction. Also interesting to observe would be what happens in the Parliament, especially during mid day in Rajya Sabha.
BJP issued a whip for all MPs to be present and that also will have an impact if something significant happens. Technically, 12120-12150 that coincides with 20 and 50dma would be a major resistance and if that is taken out then it has the fire power to cross even the 12300 mark. On the down side the 100dma of 11900 will be a support in case of any adverse events hitting the market.
On the derivatives front, the selling continued in the futures market as FIIs sold close to 400 Cr in futures market and the overall long positions in Nifty futures fell to 16% but Nifty futures which was in discount till now has moved into premium of 8 points. On the options front, the Nifty put call ratio fell further to 1.31 from 1.39 levels as short positions were continuing in call options. 12100 call sae 13.6 lakh positions created followed by 12200 call 6.1 lakh contracts and 12250 call added 5.3 lakh contracts. 12100 call has the highest OI on call side while on put side 12000 put added 4.4 lakh positions and 11950 and 11900 put added 3.2 lakh and 2.5 lakh positions respectively. 12000 put has the highest OI on put and for thursday expiry the range narrowed down to 12000-12100 and today’s movement will be important to see.
What is the Nifty call for the day?
As I write this post, AAP has crossed the halfway mark and leading in 41 out of 55 leads that are available. BJP just managed to hit double figures leading in just 11 seats. If the trend holds then there will be AAP govt one more time with 50 plus seats. Though it is expected, there could be some reaction at the opening time and for first two hours. Nifty is likely to open around 12050 mark and might test 12000 level and might be in the 12000-12100 range till mid day. We might have a different market post noon as global factors might take over if nothing happens in the parliament today. So, the trade for the day is to take a long position whenever there is a dip to 12050 mark with 12120-12150 as the target. Today is the day where Nifty could go all the way upto 12200 mark also if things go positive.