June series was indeed the month of consolidation for our market. The index remained in a slender range for the major part of the series. Eventually, due to some tail-end sell off, we ended the series lower with a cut of 1.37%. Although, the benchmarks ended June series in red, we saw a spectacular run specifically in Pharma space. IT counters too supported the market; whereas, other sectors like Metal, Infra and PSU banks continued to remain draggers.
As far As FIIs activity is concerned, they continued their selling streak in equities as they sold to the tune of Rs. 9140 crores in June and Rs. 31,300 crores in last 3 months. During the series, there was a mixed activity being witnessed in index futures segment. Stronger hands added short positions throughout the series and also rolled some of them. Now index futures 'Long Short Ratio' stands at 35%, hinting once again they hold majority of short in the coming series. Looking at last two days fall, we believe most of the longs in index futures have been lightened up; whereas, decent amount of shorts are still in the system. As a result, Nifty rollover shot up to 64% as compared to its Wednesday's figure, which is on the higher side. In Nifty options front, build-up is scattered between 10700-11000 call options; while, 10600 put option has maximum OI concentration. Considering the above data points, we would advise traders avoiding aggressive longs for a time being.
- ICICIBANK (81.48%) corrected more than 5% with decent short formation. Rollover is on the higher side in terms of percentage and OI. Now, the earlier support of Rs. 280-282 shall act as resistance. Hence, any bounce back shall be an opportunity to short.
- Post some correction, YESBANK (84.33%) has been trading in a range of Rs.325-340. This counter is also light in terms of OI; thus, fresh build-up in either direction may decide the future trend for this counter.
- DHFL (89.20%) is the only counter in this space that added longs last series and these position got rolled too. This counter has an immediate support of Rs. 620-625 levels; thus, one can hold their existing longs with the strict stop loss below the support zone.
- BAJAJ-AUTO (89.16%) corrected from Rs. 2940 levels along with decent shorts. These positions are still intact; however, this counter has a strong support near Rs. 2700 mark. Thus, we expect some short covering move going ahead.
- TVSMOTOR (89.81%) extended its loss in June series, we also witnessed good amount of shorts. We believe there is a further scope of correction towards Rs. 530-532 levels; thus, it's a sell on rise candidate for us.
- Other stocks wherein we saw short rollovers are ASHOKLEY (88.58%), BALKRISIND (82.68%) and EICHERMOT (85.61%).
- TITAN (66.46%) continued to attract shorts in last series. However, the rollovers were below average, hinting most of the shorts are out of the system. This counter also has strong support near Rs. 820-825 levels, thus; traders can opt to buy this counter on dips.
- MCDOWELL-N (88.98%) ended June series lower by 2%; but, this was mainly due to long unwinding seen in last two trading session. At present, this counter is light in open interest. Hence, we would advise traders to wait for fresh build-up before initiating any directional position.
- Since past 11 months, ITC (78.96%) has been trading in a broader range of Rs. 250-290 levels. Last series, this counter corrected but shorts were not rolled to July series. In addition, stock is now trading near the lower side of the range; thus, we would advise traders to add this counter on dips.
- RELIANCE (84.17%) outperformed this space, as this was the only counter that concluded June series in green. We also decent longs and we believe these positions are still in system. Thus, this counter may once again rally towards 1000 mark going ahead.
- BPCL (73.87%) in last series corrected nearly 10% and also added massive shorts. Rollover figure is also on the higher side, hinting shorts formed are still intact. However, this counter has very strong support near Rs. 360 levels and it also short heavy. Thus, one can expect short covering rally soon in this counter.
- Other stocks that corrected mainly due to long unwinding are GAIL (77.80%), ONGC (72.94%) and PETRONET (88.22%)
- Although HINDALCO (78.76%) concluded the series with a cut of 5%; we hardly saw any short rollovers series on series. At present, this counter has a strong support near Rs. 214-216 levels. Hence, fresh long formation may soon attract this counter.
- TATASTEEL (90.83%) has been correcting consistently in last 5 months. Last series too, we saw decent short formation. However, it has a very important support near Rs. 535-540 levels and hence, we expect some short covering move towards Rs. 590-595 levels
- Some of the counters having high rollovers are NATIONALUM (85.41%), VEDL (87.67%) and SAIL (89.22%).
- Most of the heavy weight Pharma conglomerates like SUNPHARMA (92.07%), LUPIN (77.05%), CIPLA (73.74%) and GLENMARK (86.38%) rallied mainly due to short covering. We believe this counters may soon attract fresh buying. Thus, traders are advised to hold on to their long if any and those looking to enter shall buy at dips.
- DRREDDY (88.05%) is the only counter that rallied due to addition of long positions. These positions have been rolled too. We believe any dips towards, Rs. 2170-2180 levels shall be an opportunity to re-enter.
- WOCKPHARMA (82.24%) underperformed the entire Pharma space. In the recent, correction from 750 levels, we saw some profit-booking followed by addition of shorts. Thus, one should avoid bottom fishing in this counter.