Dalal St Daily 14th October

 GLOBAL MARKETS

  • US markets closed red.
  • DOW snaps four days win streak and fell on Tuesday as negative vaccine news and fading hopes for another round of government stimulus.
  • DOW ended 120 points or 0.5 % lower and S&P 500 ended up as same 1.5% lower.
  • Dollar Index gains as the hope on stimulus fades.
  • Dollar gains on every currencies. 
  • Dollar rupee is now trading @ 73.36
  • Brent Crude is trading at $40 per barrel.
  • US markets VIX are rising.
  • European markets ended up in the negative terrritory.

DOMESTIC MARKETS
  • Asian markets are down.
  • SGX Nifty is trading 33 points lower @11900.
  • Our markets are expected to open lower following the global cues. 
  • The market closed the range bound session on a flat note on October 13 as the rally in IT stocks supported the market, but selling in banking and financials, pharmaceuticals, select automobiles and fast moving consumer goods (FMCG) stocks capped the gains.
  •  This correction after 1150 points rally in the markets are expected and good mode of correction for BULLS watch out the level 11820 as it was the previous swing high which was broken.
  • In the technical perspective Nifty formed a doji kind of pattern which shows indecision in the markets.
  •  Normally, a formation of Doji after a reasonable up move or down move could be considered as a warning signal for a trend reversal. Having formed this pattern beside the last negative candle could mean less predictive value for this Doji pattern.
  • The broader markets continued to underperform benchmarks with the Nifty Midcap index falling half a percent and Smallcap down 0.2 percent.
  • Nifty was showing support @11900 level, and was range bound within the range of 11900-11950 for the complete afternoon session.
  • We may see some volatile moves today in the markets.
  • Yesterday Bank Nifty ended up in the negative territory due to the ongoing interest on interest case.
  • Even though the markets knows what the supreme orders will be and the impact of it, they have already factoring in the markets and they want to end this interest on interest case.
  • For sure when this ends Bank Nifty will shoot up like anything.
  • Without the support of Reliance and Bank Nifty, The major tracking index Nifty shot up 1000 points back to its recent swing highs and breaking it. Nifty is almost near to its all time highs and it has recovered about 85-90% from the lows of march. But Bank Nifty has still not even recovered 50% of the crash in the march. 
  • Just imagine once what happens when Bank Nifty starts rallying towards the all time highs and once it starts Nifty breaking 112400-12500 levels are known and there must be no surprise with it.
  • And the monster of Nifty index is Reliance is also still correcting even though the Nifty was rallied for 10 straight sessions. And if reliance starts to rally for sure it will fuel up the next upcoming rally in Nifty breaking 12000.
  • HDFC Bank was experiencing huge Long Unwinding due to the earnings event coming ahead.
  • MindTree was experiencing huge Short Covering due to the earnings event coming ahead.
  • Wipro came out with their results. Wipro reported a dollar revenue growth of 3.7 percent at $1,992.4 million against $1,921.6 million QoQ. Management expects dollar revenue growth at 1.5-3.5 percent in Q3.
  • WIPRO ADR was down by 2.2% which shows Wipro will be opening lower which can fuel up the global cues to the markets.
  • Infosys are coming out with their results today, Infosys saw long built up in its Open Interest.
  • Infosys ADR is up by 1%.
  • there are many events today affecting the markets trade cautiously. Important WPI inflation will be coming within the market hours in the afternoon session.
  • Crude Oil inventories data will be released after the market hours.
  • FII's are net buyers and they are interested @ this levels.
TRADING RANGE
  • Nifty may trade between 11830-12000 range.
  • Bank Nifty will be very volatile today.
  • Bank Nifty may trade between 23100-23900 range.
OI ANALYSIS

CALLS
  • Maximum Call OI was seen at 12,500 strike, which will act as crucial resistance in the October series.
  • Call writing was seen at 11,900 strikes, which added 1.05 lakh contracts.
  • Call unwinding was seen at 11,200 strike.
PUTS
  • Maximum Put OI was seen at 11,500 strike, which will act as crucial support in the October series.
  • Put writing was seen at 11,600 strike, which added 4.7 lakh contracts.
  • Put unwinding was witnessed at 11,200 strike.
BUILT UP
  • Long Built Up was seen in IT sectors, metal and telecom.
  • Short Built Up was seen in media, pharma, PSU Banks.
  • Long unwinding was seen in Nifty, Bank Nifty stocks, Private Banks, infra, FMCG and auto sectors.
  • Short Covering was seen in Oil and Cement sectors.
  • HDFC Bank was experiencing huge Long Unwinding.
  • But Kotak Bank was experiencing Short covering.
  • Mind Tree was experiencing huge short covering.
  • TCS was experiencing long unwinding.
  • Reliance was experiencing huge short covering in its OI



FII & DII ACTIVITY
  • Foreign institutional investors (FIIs) net bought shares worth Rs 832.14 crore.
  • Domestic institutional investors (DIIs) net sold shares worth Rs 1,674.46 crore

Location: Bengaluru, Karnataka, India

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