Long Short Ratio back to 60%: Angel Broking

Ms. Sneha Seth (Derivatives Analyst, Angel Broking):

"We began the very first session of June series with an upside gap of decent margin and rallied towards the record high. All of a sudden, sharp sell-off was seen in the mist to drag index below 11850 mark but soon recovered some of the losses to reclaim 11900 on the closing basis.

During last series, we observed decent long formation in both the indices and we believe some of these positions have been rolled over too. Rollovers in Nifty stood at 71.93%, slightly higher to the 3-month averages. Throughout the series, stronger hands formed hedged positions (selling index futures and buying equities) which resulted in a decline in their index futures 'Long Short Ratio' from 75% to 50%. However, on the expiry day they rolled over fewer shorts which bought this ratio back to 60%. The volatility index rallied towards 30% (Highest since September 2015) before the Lok Sabha election results and soon cooled-off, which is the normal phenomenon post the event. At current juncture, 12500 call and 11500 puts are attracting trader's attention. Considering the rollovers and the price action in heavy weight individual counters we maintain our optimistic stands on market and soon expect Nifty to surpass the immediate hurdle around 12000 marks.

The rollover for the banking index is 82.99%, above its 3-month average of 77%. BankNifty out-performed the benchmark index and also added decent positions series on series. As this index has already given a fantastic run, we would now focus on other sectors like IT and oil marketing companies."

Source : Equity Bulls

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