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Nifty outlook: 

The pull back yesterday in the second half may have helped shake off the weakness that has crept in after prolonged upsides in the last few days which had begun to show as negative divergences, as discussed yesterday. This allows Nifty to continue on the 18,800-19,000 trajectory, without much of a drama. This also encourages us to keep the downside marker in the 18,500 vicinity for the opening moves, and move it higher as the day progresses.   

Derivative:

Nifty weekly contract has highest open interest at 19,000 for Calls and 18,500 for Puts while monthly contracts have highest open interest at 19,000 for Calls and 18,000 for Puts. Highest new OI addition was seen at 18,700 for Calls and 18,600 for Puts in weekly and at 18,800 for Calls and 18,600 for Puts in monthly contracts. FIIs increased their future index long position holdings by 3.56%, increased future index shorts by 2.64% and in index options by -4.06% in Call longs, -6.64% in Call short, -3.29% in Put longs and -2.36% in Put shorts.  

USD-INR outlook:

A brief period of upsides failed to gather momentum, resigning USD-INR within the 81.70-81.53 band discussed yesterday. We may have to let go of the upside expectations, if USD-INR prefers the 81.6 - 81.53 vicinity early in the day, but will play a collapse only once below 81.35.  

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