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Nifty continued its downward journey for the sixth day in the row  - HDFC Securities 

F&O HIGHLIGHTS

LONG UNWINDING WAS SEEN IN THE NIFTY & BANK NIFTY FUTURES

* Market ended with robust gains on Monday as investors cheered Union Budget proposals. The Nifty 50 index surged 646.60 points or 4.74% to 14,281.20. Both the indices corrected about 7% each in the previous six trading sessions.

* Long build up was seen in Nifty Futures’ where Open Interest increased by 9.40% with Nifty rising by 4.68%.

* Bank Nifty Future’s too saw increased in OI with rise in price as Bank Nifty OI increased by 12.01% with rise in price by 8.50%. Bank Nifty outperformed the Nifty as most of the banking stock was the gainer after budget announcement.

* Nifty Open Interest Put Call Ratio rise sharply to 1.41 levels from 0.98 levels. Amongst the Nifty options (04-Feb Expiry), Call writing was seen at 14500-14800 levels, Indicating 14500-14600 level will act as a resistance. On the lower side, support is seen in the vicinity of 14200-14300 levels where we have seen Put writing. To Sum It Up, Long Build up in the Nifty Futures and Bank Nifty Futures & sharp rise in the Nifty Open Interest Put Call ratio on the back of Put writing at 13800 - 14300 levels Indicates that one should remain bullish on the markets with strict stoploss of 14200 level. However considering the sharp rise in yesterday session on back of budget outcome possibility of profit booking at higher levels should not be ruled out. Therefore, our advise is to remain cautious and use any dip to buy stocks. On the lower side 14200 - 14300 level will act as an immediate support where Puts have been written. In the Bank Nifty, where we have seen long build up, our advice is to be bullish with the stop loss of 32800 level. On the higher side, resistance is seen in the vicinity of 34000 level. 01 Feb 2

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