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Nifty outlook:  

Five consecutive days of lower close, along with narrowing range,had upped the prospects of an explosive range breakout, but such hopes have been deflated by VIX sinking to 11.6. But this turn of events also rules out prospects of a collapse with the 17370/270 region appearing as a strong support. Meanwhile, the 17600 vicinity has acted as a sticky pivot lately, which is also the reason why a penetration of the same on Friday turned out to be brief. This suggests that Nifty may be allowed to rise to 17740 or 17830, before bears regroup. Alternatively, inability to float above 17640 may also be taken as a weak signal, though slippage past 17500 is not expected today.

Derivative:

Nifty weekly contract has highest open interest at 17700 for Calls and 17000 for Puts while monthly contracts have highest open interest at 17700 for Calls and 17000 for Puts. Highest new OI addition was seen at 17700 for Calls and 17600 for Puts in weekly and at 17700 for Calls and 17600 for Puts in monthly contracts. FIIs increased their future index long position holdings by 9.33%, increased future index shorts by 3.02% and in index options by 29.98% in Call longs, 20.37% in Call short, 70.08% in Put longs and 37.55% in Put shorts.

USD-INR outlook:

We start again with similar hopes as that of Friday, expec?ng 81.97 to offer a bounce. However, major upsides are less likely with selling pressure expected to resurface on first entry into the 82.15-82.20 region. Inability to float above 81.97 should render the trend with a sideways bias.

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