Bears preferred covering their shorts as Nifty surpassed an important hurdle of 9200 mark: Angel Broking

Views of Ms. Sneha Seth (Equity Derivative Research Analyst, Angel Broking):

"Market rallied 0.70% and concluded the day at the highest point. During the day, the benchmark index (Nifty) went on to register records highs and has now even surpassed an important hurdle of 9200 mark ahead of the RBI Monitory Policy. FIIs continue to hold on to their long positions formed in Index Futures in last four successive series. Today, as Nifty breached its resistance zone, bears loosed hopes on market and preferred exiting their shorts in Index Futures, as a result Nifty open interest plunged 4.58%. Heavy weight counters like LT (5.21%), DRREDDY (4.14%), RELIANCE (3.77%) and ICICI BANK (3.03%) were the major contributor in today's move. In options front, 9400-9600 call options remained quite active and they also added decent positions with rise in call IV's (Implied Volatility). Thus, suggesting fresh longs were formed in these call strikes. While on the flip side, huge build-up was seen in 9000-9200 put options. As per the options data, we do not see any major hurdle before 9450-9500 mark. Thus, taking into consideration the overall data, we expect market to remain optimistic in the near term. Traders are suggested to trade with a positive bias and utilize decline to form fresh longs as the base has now been shifted higher to 9000 – 9050."

Source : Equity Bulls

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