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Nifty ended with modest losses on Wednesday, amid profit selling after recent steep gains - HDFC Securities

F&O HIGHLIGHTS

UNWINDING WAS SEEN IN THE NIFTY FUTURES

REMAIN BULLISH TILL NIFTY SUSTAINS ABOVE 17000 LEVEL

* Nifty ended with modest losses on Wednesday, amid profit selling after recent steep gains. The Nifty managed to hold the 17,000 mark. Realty shares soared while IT and metal shares corrected. Nifty finally closed down by 0.33% at 17076.25 levels.

* Unwinding was seen in Nifty Futures’ at higher levels, where Open Interest fell marginally by 0.34% with Nifty falling by 0.33%

* Long build up was seen in Bank Nifty Futures’ where Open Interest rose by 3.81% with Bank Nifty rising by 0.25%

* Nifty Open Interest Put Call Ratio fell to 1.17 levels from 1.66 levels. This steep fall suggesting traders may have exited Put options without building new positions in the Put segment. Amongst the Nifty options (02-Sep Expiry), no fresh Put writing was seen, maximum outstanding positions was seen in 17000 Put suggesting support around this level. On the higher side, an immediate resistance is seen in the vicinity of 17200 - 17300 levels where we have seen Call writing.

* Long unwinding was seen by FIIS’ in the Index Futures segment where they net sold worth Rs 873 Cr with their Open Interest going down by 3925 contracts.

To Sum It Up, long build up in the Bank Nifty Futures & no fresh built up in Puts, Indicates that one should expect positive move in the Index until Nifty holds above 17000 level.

Therefore, our advise is to keep building long positions until Nifty hold above 17000 level

In the Bank Nifty, our advice is to remain bullish with the stop loss of 36300 levels. On the higher side, resistance are seen in the vicinity of 37000 - 37200 levels.

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