Market may appear overbought, but its not - Angel Broking

Nifty spot closed at 5850.60 this week, against a close of 5680.40 last week. The Put-Call Ratio has increased from 1.28 to 1.33 levels and the annualized Cost of Carry is positive 12.14%. The Open Interest of Nifty Futures increased by 7.87%.

PCR-OI has increased from 1.28 to 1.33 levels. This ratio has mainly increased due to significant amount of buildup in the range of 5600- 5900 put strikes, followed by decent unwinding in 4900-5400 strikes. In call options we have witness good amount of buildup in the range of 6000-6300 strikes last week and decent unwinding was observed in 5400-5800 strikes. Highest buildup is seen in 6000 call & 5300 put options.

Total open interest of market has increased from Rs. 1,33,913/- cr. to Rs. 1,49,492/- cr. Stock futures open interest has increased from Rs. 29,441/- cr. to Rs. 30,265/- cr. Some of the large cap which added open interest are SIEMENS, TATAPOWER, LT, BHEL and TATAMOTORS. Open interest was shed in large cap names like AXISBANK, SESAGOA, IDFC, PNB and ACC.

Implied Volatility (IV) for NIFTY has increased from 25.93%.to 27.04%. Historical volatility (HV) is at 36.24% and that for BANKNIFTY is trading at 57.95%. Liquid counters having very high HV are FINANTECH, JPPOWER, YESBANK, HDIL and OPTOCIRCUI. Stocks where HV are on lower side are OFSS, DRREDDY, JUBLFOOD, DIVISLAB and WIPRO.

Nifty futures closed at a premium of 25.30 points against the premium of 17.40 points to its spot. Next month future is trading with premium of 68.90 points. Liquid counters where CoC is high are ASHOKLEY, JISLJALEQS, CHAMBLFERT, ADANIPOWER and OPTOCIRCUI. Stocks with negative CoC are NMDC, FINANTECH, HDIL, BHEL and AXISBANK.

Source : Equity Bulls

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