Not a great start to the New year as we had a very flat day yesterday. The volumes were relatively lower than the other days but they are upwards of 10 lakh crore which is not a bad sign at all. If bulls were expecting 12300 to be crossed for the new year then this has been a bad day for them as many are set to lose a lot of money in today’s options expiry, as Nifty has not even cross 12200 mark, but for bears its a celebration time.
We had a Nifty that was as flat as it can get as Nifty traded in 12170-12210 band for the most part of the day and closed in that range. Globally, we don’t have any cues from US markets as they were shut for New Year yesterday. Today morning some of the Asian markets like Japan are not trading and Hong Kong which is trading is up 300 points, indicating a positive start for us.
Domestically, this is the start of the new year and we started that with some good news coming on GST front. For the month of December, the GST collections came in at 1.03 lakh crores vs expected 1.1 lakh crore, which is still okay. This is the second consecutive month of 1 lakh plus crore collections and Govt had kept a target of 4.65 lakh crore for 4 months remaining in this fiscal.
Now the asking rate is 3.62 lakh crore in 3 months. The other good news is the auto sales numbers, where Maruti has seen a 4% growth in volumes after a long time and other 4 wheeler companies also did relatively well. Technically, Nifty is finding support at 12150-12170 range and if that holds it can look at 12300 getting broken in next one week. A breach of 12150 can take Nifty to 12100 which is the 20 dma.
On the derivatives front, there was some bullishness seen in F&O market as there was more buying seen than selling. In the futures market, there was a buying of 200 Cr and that indicates that many traders are bullish about Nifty going up in the near term. The options chart is, however, showing there was shorting of puts as well as calls were happening because of which the open interest remained more or less flat.
12150 put added 6 lakh positions while 12100 put added 5.6 lakh positions and now 12100 put has the highest OI on the put side, till yesterday 12200 put was having the highest OI. On the call side, 12250 call added 3.7 lakh positions and 12200 call added 3.4 lakh positions and 12300 call added 2 lakh positions and 12300 still has the highest OI on call side making it a 12100-12300 expiry range for this series.
What is the Nifty call for the day?
After a very narrow day yesterday with low volumes yesterday, we are going to start slightly positive today in 12170-12200 range and if Nifty finds support at 12150-12170 then it can go above 12200. If Nifty stays above 12200 early morning, it could trigger a short-covering which can take Nifty to 12250 levels and then the 3 PM move will decide the expiry.
If Nifty couldn’t reach 12200 in early morning trade then expect a choppy trade between 12100 and 12180 mark. In either case, its a buy on dips markets and you can go long after the first hour depending on where Nifty settles. Today’s expiry could be anywhere between 12100-12300 mark.