FII Activity: Bullish Sentiment in Nifty Index Futures
- Foreign Institutional Investors (FIIs) displayed a bullish outlook in the Nifty Index Futures market, actively buying 27727 contracts worth ₹845 crore. This activity led to a significant decrease of 12143 contracts in the net open interest.Breaking Down FII Activity:
- FIIs added 4189 long contracts.
- FIIs covered 30325 short contracts, drastically reducing their short exposure.
Client Behavior:
- Clients covered 51957 long contracts.
- Clients also covered 32691 short contracts.
Current Positioning in Index Futures:
- FIIs: Holding 25% long and 75% short positions, reflecting a strong bearish bias despite recent long-leaning activity.
- Clients: Holding 72% long and 28% short positions, indicating a more optimistic market outlook.
Analysis:
The data highlights a stark contrast in sentiment between FIIs and clients:- FIIs continue to maintain a bearish stance despite reducing short positions and increasing long exposure.
- Clients appear to be in capitulation mode, having reduced the majority of their long positions and some shorts.
Traders’ Note:
The reduction in short exposure by FIIs suggests caution in maintaining aggressive bearish positions. However, with FIIs still holding a significant short bias, traders should monitor price action closely for any potential reversal signals.
Nifty has broken its previous swing low of 22,976, which will now act as a strong resistance level. While Nifty is expected to open with a gap-up, traders should closely monitor the 22,976 level. A sustained move above this level could trigger a short-covering rally.
Today, we have a significant Mercury ingress into an Air sign, the implications of which I’ve discussed in detail in the video below. In the video, I’ve also referenced the COVID crash and the September 26, 2024, market top to provide deeper insights. Make sure to watch it for a comprehensive understanding.
As highlighted in the weekly analysis, prioritize intraday trading as Nifty is likely to remain volatile due to the multitude of astrological events unfolding.
Nifty experienced a decent upmove but failed to close above 22,976, as SENSEX expiry pressure at 2:45 PM, combined with our time cycle, triggered a 200-point decline within 15 minutes.
Today, with the New Moon and Uranus Declination, Reliance and IT stocks should be on the radar.
Key Levels to Watch:
- Bullish Scenario: Nifty needs to close above 23,150 to confirm a short-term bottom, potentially triggering rapid short covering toward 23,343–23,400.
- Bearish Scenario: A break below 22,850 could lead to a decline toward 22,751/22,666.
Nifty Trade Plan for Positional Trade ,Bulls will get active above 22976 for a move towards 23088/23239/23390. Bears will get active below 22816 for a move towards 22751/22666
Traders may watch out for potential intraday reversals at 09:38,11:35,12:16,02:05 How to Find and Trade Intraday Reversal Times
Nifty December Futures Open Interest Volume stood at 0.89 lakh cr , witnessing liquidation of 28 Lakh contracts. Additionally, the increase in Cost of Carry implies that there was covering of SHORT positions today.
Nifty Advance Decline Ratio at 25:25 and Nifty Rollover Cost is @23879 closed below it.
Nifty Gann Monthly Trade level :23721 closed below it.
Nifty has closed below its 200 SMA @ 23945 Trend has changed to Buy on Dips once above 22976
Nifty options chain shows that the maximum pain point is at 23000 and the put-call ratio (PCR) is at 76 .Typically, when the PCR open interest ranges between 0.90 and 1.05, the market tends to remain range-bound.
Nifty 50 Options Chain Analysis
The Nifty 50 options chain indicates that the highest open interest (OI) on the call side is at the 23000 strike, followed by 23100 strikes. On the put side, the highest OI is at the 22800 strike, followed by 22700 strikes. This suggests that the market participants are expecting Nifty 50 to remain range between 22800-23200 levels.
Retail Activity in Options Market
According to today’s data:
- Retail investors sold 99.6 K Call Option contracts and shorted 256 K Call Option contracts.
- They also bought 108 K Put Option contracts and covered 904 K Put Option contracts, indicating a bearish bias in the market.
FII Activity in Options Market
- Foreign Institutional Investors (FIIs) added 10.4 K Call Option contracts and covered 205 K Call Option contracts.
- On the Put side, FIIs added 278 K Put Option contracts and shorted 356 K Put Option contracts, suggesting a shift toward a Neutral to Bullish bias.
In the cash segment, Foreign Institutional Investors (FII) sold 4920 crores, while Domestic Institutional Investors (DII) bought 6814 crores.
Traders who follow the musical octave trading path may find valuable insights in predicting Nifty’s movements. According to this path, Nifty may follow a path of 22751-23408-24105-24801 This means that traders can take a position and potentially ride the move as Nifty moves through these levels.Of course, it’s important to keep in mind that trading is inherently risky and market movements can be unpredictable.
Mental Toughness is my business. Make it part of yours. Keep a journal. Feed your mind.
For Positional Traders, The Nifty Futures’ Trend Change Level is At 23086. Going Long Or Short Above Or Below This Level Can Help Them Stay On The Same Side As Institutions, With A Higher Risk-reward Ratio. Intraday Traders Can Keep An Eye On 23003, Which Acts As An Intraday Trend Change Level.
Nifty Intraday Trading Levels
Buy Above 23000 Tgt 23044, 23088 and 23125 ( Nifty Spot Levels)
Sell Below 22950 Tgt 22916, 22888 and 22824 (Nifty Spot Levels)
Wishing you good health and trading success as always.As always, prioritize your health and trade with caution.
As always, it’s essential to closely monitor market movements and make informed decisions based on a well-thought-out trading plan and risk management strategy. Market conditions can change rapidly, and it’s crucial to be adaptable and cautious in your approach.
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