FII Activity: Bearish Sentiment in Nifty Index Futures with Signs of Position Unwinding
Foreign Institutional Investors (FIIs) maintained a bearish stance in the Nifty Index Futures market, actively shorting 1,632 contracts worth ₹303 crore. However, the net open interest decreased by 198 contracts, suggesting position unwinding rather than aggressive fresh shorts.
Breaking Down FII Activity
- FIIs covered 634 long contracts, reducing bullish exposure.
- FIIs added 717 short contracts, reinforcing a mild bearish outlook rather than aggressive selling.
Client Behavior
- Clients covered 966 long contracts, indicating profit booking or reducing bullish bets.
- Clients covered 2,840 short contracts, reducing their bearish exposure, suggesting some belief in market stability.
Current Positioning in Index Futures
- FIIs: Holding 16% long and 84% short positions → Maintaining an overall bearish stance but not aggressively adding shorts.
- Clients: Holding 70% long and 30% short positions → Maintaining a more optimistic market outlook.
The market remains in a critical phase, with FIIs maintaining a bearish stance but showing signs of unwinding. Key support and resistance levels will determine the next major move!
Nifty opened with a gap down but found strong rejection at 22,774—the Mercury Ingress low, triggering a sharp recovery. This price action aligns with two significant astro events:
- Mercury Ingress – Known to cause reversals in market trends.
- Moon Declination – Often brings volatility and potential turning points.
Key Levels to Watch
Bullish Scenario:
- Above 23,000 → Bulls need a close above this level tomorrow to confirm a short-term bottom.
- Upside Targets:
- 23,135 – Lunar Resistance (first major hurdle).
- 23,300 – Octave Point (a key Gann level where strong reactions occur).
Bearish Scenario:
- Failure to close above 23,000 may invalidate the reversal attempt, keeping further downside open.
Gann Rule in Play – 9:5 Ratio Signal
According to Gann’s 9:5 Rule:
“If a price falls for 9 consecutive days, there is a high probability of a 5-day rally.”
- If today’s low holds and Nifty closes above 23,000, this rule could trigger a multi-day recovery.
- A strong reversal pattern suggests a potential short-covering rally in the coming days.
Market Outlook & Trading Strategy
✔ Bullish Bias: Focus on NBFC and rate-sensitive stocks, which may outperform due to Mercury Ingress effects.
✔ Watch 23,000 closely – This is the line in the sand for bulls.
✔ Intraday Play: If Nifty crosses 23,135, expect acceleration toward 23,300.
✔ Risk Management: Below 22,774, bears regain control, leading to further downside.
Final Thoughts:
With astro cycles and Gann’s time rules aligning, the market is at a critical inflection point. Tomorrow’s close will decide whether reversal momentum builds toward higher targets.
Nifty opened with a gap down but once again held the 22,800 support level, continuing the recent pattern of intraday recoveries from lower levels. This price action suggests accumulation at lower levels, but a break below 22,800 on a closing basis could trigger a steep decline.
Key Technical & Astro Insights
✔ Repeated gap-down recoveries indicate possible accumulation, but confirmation is needed.
✔ Sun Ingress today – PSU stocks should be on high watch for potential upside.
✔ Nifty has formed an NR7 pattern (narrowest range in the last seven days) on an astro date, signaling a big move ahead.
Key Levels to Watch
Bullish Scenario:
- A close above 23,000 would confirm a short-term bottom and trigger an upside move.
- Upside Targets: 23,135 (first resistance), 23,300 (Octave Point).
Bearish Scenario:
- A break below 22,800 on a closing basis could lead to a sharp fall.
- Downside Targets: 22,650 / 22,500.
Market Outlook & Trading Strategy
✔ Watch PSU stocks closely as Sun Ingress could drive momentum in this sector.
✔ If Nifty holds 22,800 and reclaims 23,000, a short-covering rally could trigger.
✔ Failure to hold 22,800 may invite aggressive selling, leading to sharp downside.
✔ NR7 pattern suggests an explosive move is coming—stay prepared!
Watch the video below for deeper insights:
Watch the video below for a detailed analysis
Nifty Trade Plan for Positional Trade ,Bulls will get active above 22951 for a move towards 23026/23102/23177. Bears will get active below 22800 for a move towards 22725/22666.
Traders may watch out for potential intraday reversals at 09:54,10:49,11:30,12:44,01:52,02:35 How to Find and Trade Intraday Reversal Times
Nifty December Futures Open Interest Volume stood at 1.67 lakh cr , witnessing liquidation of 4.1 Lakh contracts. Additionally, the increase in Cost of Carry implies that there was addition of SHORT positions today.
Nifty Advance Decline Ratio at 24:26 and Nifty Rollover Cost is @23879 closed below it.
Nifty Gann Monthly Trade level :23529 closed below it.
Nifty has closed below its 20 SMA @ 23251 Trend has changed to Buy On Dips till above 22900
Nifty options chain shows that the maximum pain point is at 23000 and the put-call ratio (PCR) is at 0.85.Typically, when the PCR open interest ranges between 0.90 and 1.05, the market tends to remain range-bound.
Retail & FII Activity in the Options Market – Key Insights & Market Outlook
Analyzing retail and FII positioning in the options market provides valuable insights into market sentiment and potential price action. Here’s a breakdown of today’s activity:
Retail Activity in Options Market
Retail traders showed a bearish tilt, with aggressive put activity and more call shorting than buying.
Call Options:
- Added 50.8K contracts, suggesting some bullish bets.
- Shorted 110K contracts, indicating expectations of strong resistance at higher levels.
Put Options:
- Added 388K contracts, signaling significant downside hedging.
- Shorted 329K contracts, suggesting confidence that key support levels will hold.
Retail Takeaway:
Retail traders are positioning for volatility, with heavy put buying but also put shorting, indicating they are hedging downside risk but not fully committed to a crash.
FII Activity in Options Market
FIIs displayed a neutral stance, with relatively balanced call and put activity.
Call Options:
- Added 7.5K contracts, showing minimal bullish intent.
- Shorted 12.3K contracts, reinforcing resistance at higher levels.
Put Options:
- Added 8.8K contracts, hedging against downside risks.
- Shorted 11.3K contracts, reducing their bearish exposure.
FII Takeaway:
FIIs are not aggressively betting in either direction, but their call shorting suggests they expect resistance at higher levels.
Market Outlook & Key Takeaways
✔ Retail traders are hedging against downside risk but are not fully bearish.
✔ FIIs remain cautious, slightly leaning towards range-bound action.
✔ Call shorting by both FIIs & retailers indicates strong overhead resistance.
✔ Heavy put shorting suggests confidence in support levels holding.
Final Thoughts: The market appears to be trading within a defined range, with both upside and downside hedging in place.
Nifty 50 Options Chain Analysis
The Nifty 50 options chain indicates that the highest open interest (OI) on the call side is at the 23100 strike, followed by 23300 strikes. On the put side, the highest OI is at the 22900 strike, followed by 22800 strikes. This suggests that the market participants are expecting Nifty 50 to remain range between 22900-23300 levels.
In the cash segment, Foreign Institutional Investors (FII) bought 4786 Cr , while Domestic Institutional Investors (DII) bought 3072 cr.
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. Price took support near 22751
When you really believe that trading is simply a probability game, concepts like right or wrong or win or lose no longer have the same significance.” – Mark Douglas
For Positional Traders, The Nifty Futures’ Trend Change Level is At 23370 . 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 22934 , Which Acts As An Intraday Trend Change Level.
Nifty Intraday Trading Levels
Buy Above 22920 Tgt 22960, 23000 and 23066 ( Nifty Spot Levels)
Sell Below 22848 Tgt 22816, 22777 and 22729 (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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