Trading ideas (Time period: 1-3 days)
Posted: Fri Mar 31, 2017 2:36 pm
Trading ideas (Time period: 1-3 days)
Finolex Industries (Buy above 570, for Target of 595, Stop Loss at 557): After consolidating for over 4 weeks the stock has finally broken out from a flag pattern, which is a classic continuation pattern. Rise in traded volumes and momentum oscillators indicate strength in the current price outburst. It suggests Finolex Ind will further move in the direction of its primary up trend.
Rollover Analysis
Markets upbeat, Bank Nifty likely to shine
Markets were on a hot streak, as Nifty managed to close above its previous lifetime high of 9119 level. Nifty PSU index outperformed Nifty Bank Index by a whopping 3.1% as the news on fresh capital infusion in PSU banks gained momentum. Put option writers took center stage as the indices continue to surge higher. Nifty and Bank Nifty were up by 2.6% and 3.5% on (eoe) basis. Short volatility strategies like Short Iron Butterfly spreads were the flavor of the series as the major events like RBI credit policy and FOMC credit policy unfolded during the first two weeks of the March F&O series. Participation in Nifty and Bank Nifty F&O contracts increased as open interest surged towards multi-year high on market-wide positions.
FII's continued to bet big on the Indian markets, posting a buying figure to the tune of ~Rs.21,885cr in the cash segment, highest since March 2016. Long/Short ratio of Index Futures was above 3x for almost entire series, leading to a strong up move in the indices. Rollovers of Nifty and Bank Nifty stood at 67.7% and 67.6% (2.6 Cr/2.67 lakh shares) respectively as against the 3-month average of 72% and 63%. The cost of carry in percentage terms for Nifty and Bank Nifty is lower than its previous 3-month average due to the expectation of dividend. Based on the aforementioned data, we are expecting Bank Nifty index to surge higher up to the next resistance zone of 22000. On the options front, April series starting with maximum calls base at 9500 strike (3.2 mn shares) and maximum put base at 9000 strike (3.1 mn shares).
Derivative strategies (Time period: Till expiry)
Buy LUPIN April Future @ 1450-1455, Stop Loss 1421 and Target 1479-1481.
Derivative Snippets
Markets were on a hot streak, as Nifty managed to close above its previous lifetime high of 9119 level. Nifty 9200 call at fresh long buildup indicating continuation of this rally.
FIIs were net buyers in cash market segment to the tune of Rs 68 crore.
FII’s index future long/short ratio at 3.3x vs 2.5x, with a significant unwinding of long and shorts positions to the tune of ~140K and ~82K contracts.
Finolex Industries (Buy above 570, for Target of 595, Stop Loss at 557): After consolidating for over 4 weeks the stock has finally broken out from a flag pattern, which is a classic continuation pattern. Rise in traded volumes and momentum oscillators indicate strength in the current price outburst. It suggests Finolex Ind will further move in the direction of its primary up trend.
Rollover Analysis
Markets upbeat, Bank Nifty likely to shine
Markets were on a hot streak, as Nifty managed to close above its previous lifetime high of 9119 level. Nifty PSU index outperformed Nifty Bank Index by a whopping 3.1% as the news on fresh capital infusion in PSU banks gained momentum. Put option writers took center stage as the indices continue to surge higher. Nifty and Bank Nifty were up by 2.6% and 3.5% on (eoe) basis. Short volatility strategies like Short Iron Butterfly spreads were the flavor of the series as the major events like RBI credit policy and FOMC credit policy unfolded during the first two weeks of the March F&O series. Participation in Nifty and Bank Nifty F&O contracts increased as open interest surged towards multi-year high on market-wide positions.
FII's continued to bet big on the Indian markets, posting a buying figure to the tune of ~Rs.21,885cr in the cash segment, highest since March 2016. Long/Short ratio of Index Futures was above 3x for almost entire series, leading to a strong up move in the indices. Rollovers of Nifty and Bank Nifty stood at 67.7% and 67.6% (2.6 Cr/2.67 lakh shares) respectively as against the 3-month average of 72% and 63%. The cost of carry in percentage terms for Nifty and Bank Nifty is lower than its previous 3-month average due to the expectation of dividend. Based on the aforementioned data, we are expecting Bank Nifty index to surge higher up to the next resistance zone of 22000. On the options front, April series starting with maximum calls base at 9500 strike (3.2 mn shares) and maximum put base at 9000 strike (3.1 mn shares).
Derivative strategies (Time period: Till expiry)
Buy LUPIN April Future @ 1450-1455, Stop Loss 1421 and Target 1479-1481.
Derivative Snippets
Markets were on a hot streak, as Nifty managed to close above its previous lifetime high of 9119 level. Nifty 9200 call at fresh long buildup indicating continuation of this rally.
FIIs were net buyers in cash market segment to the tune of Rs 68 crore.
FII’s index future long/short ratio at 3.3x vs 2.5x, with a significant unwinding of long and shorts positions to the tune of ~140K and ~82K contracts.