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Nifty Open Interest Put Call Ratio fell marginally to 1.12 levels from 1.30 levels - HDFC Securities

F&O HIGHLIGHTS

UNWINDING WAS SEEN IN THE NIFTY & BANK FUTURES

REMAIN BEARISH WITH TRAILING STOP LOSS OF 15800 LEVEL

* Nifty ended a volatile session with steep losses on Wednesday, led by weakness in banks and auto shares. The Nifty hit a record high of 15,800.45 in early afternoon trade. However, a sharp round of profit selling in afternoon trade dragged the benchmarks lower. All the sectoral indices on the NSE ended in the red. Negative global stocks triggered profit selling in domestic shares. Nifty finally closed down by 0.67% at 15635.35 level.

* Unwinding or profit booking was seen in Nifty Futures’ where Open Interest fell by 1.68% with Nifty falling by 0.67%.

* Bank Nifty Futures also witnesses the same, where we have seen marginal 0.09% fall in the Open Interest with Bank Nifty falling by 0.81%.

* Nifty Open Interest Put Call Ratio fell marginally to 1.12 levels from 1.30 levels. Amongst the Nifty options (10-June Expiry), Call writing was seen at 15700 - 15800 levels, Indicating resistance is seen around 15800 level. On the lower side, support is seen at 15500 level where we have seen maximum OI in the Put options.

To Sum It Up, unwinding seen in Nifty futures and the Bank Nifty Futures & Call writing at 15700- 15800 levels Indicates that one should continue to remain cautious for the markets.

Therefore, our advise is to create short positions on the rise with the trailing stop loss of 15800 levels. On the lower side 15500 level will act as an immediate support where Put has highest outstanding positions.

In the Bank Nifty, our advice is the same to create short position on the rise by keeping trailing stop loss at 35500 level.

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