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August Series Outlook

Nifty futures has rolled around 83% vs 85% with respect to the last month, the open interest for the new contract is lower, due to lower participation in to August series. Nifty futures are positively biased till we are trading below VWAP (Volume weighted average price) of 15680 for the August series. We expect nifty to be in 16100-15600 range for the first fortnight of the August series.

FIIs have sold around Rs 19,345 Cr in the cash market in July (Expiry to Expiry).

We believe the Nifty might be only positively biased if banking stock outperformed in August series. FIIs have been in reverse arbitrage mode, i.e selling in cash market and buying stock futures to bring down the equity exposure, majorly a factor depending up on Bond market and Dollar index .

Banknifty futures rolled at around 81% vs 84% compared to the last month. The open interest of Banknifty futures in this series is much higher by around 1,10,000 due to some fresh long positions during expiry. Banknifty has to outperform the Nifty this series for the bullishness to continue.

Banknifty futures have been underperforming Nifty in the last three month, we believe this might not continue in August. For the August series, ratio wise 2.34 is resistance and 2.16 the support. The ratio between Banknifty and Nifty currently at around 2.19

However the major support for Banknifty would be around 34200 levels. We expect Banknifty to be in 34000-36800 levels in the major part of August series.

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