Friday, October 21, 2011

EOD Analysis for 21st October and Outlook for 24th October 2011

Huge OI in Nifty futures today at almost 31 million throughout the day indicating a lot of roll-overs on both short and long sides. The downside triggers were kept probably for the last minute and the most visible counter with action on both sides today was LnT; at one point of time leading by over 1.5% gains in a flat market, it dropped almost 75 points from the highs of the day [I have no access to 'media' bites in Spain but it was very fishy; aggressive Call Writing seen at 1350 and 1400 levels and likewise with Puts; [Short Puts covered at lows and converted to longs with a lot of fluidity that is not a characteristic of LnT options normally; Puts gained within a span of 20 minutes and ideally, such a manipulative move calls for an investigation by the toothless regulators of India! Deep inside I know nothing is going to happen and some big guys are going to feast at the expense weak hands]

Infosys still managed to hold the 2700+ mark but could not extend the gains; Tata Motors has given a close below 180 but still far away from the crucial closing below 175 after which bears can rejoice - right now the counter is dicey] IDFC too managed to hold the 120 levels. So still not the right time to go short on these counters as they showed strength in the trough of the day as well.

I still maintain that the news over Greece has nothing much to do with the market movements and in either case, the downside risk is far greater than the upside risk regardless of whether or not a solution emerges.

If the proposed leveraged bail-out fund system comes in, it means write-downs in assets as far as investment banking is concerned and this means a confirmed sell on all bourses to make up for results [Only thing is that in this scenario, markets will rejoice for a couple of days before biting the bullet and then fall IMHO] If no solution emerges, then it is a confirmed sell without even blinking the eye. So for all who think that this is going to have some major impact on markets - yes with more downside risks

Dow in all likelihood will again repeat a show of happy Friday and sad Monday and that implies a bad Tuesday on the cards for Nifty - nevertheless we take it as it comes on Monday and review the situation again. This is the 8th consecutive close above 5032 now; IMHO, if bulls manage to retain this level on closing basis on Monday, then this may hold the downside risk to 4980 next week but the probability seems bleak. Weakness to be only confirmed after Nifty posts a close below 4880 and Banknifty posts a close below 9500.

Global market updates will be given over the weekend as usual; thanks for visiting our blogs and hope you enjoyed the profits. After a disappointing performance last week, happy to say that things got better for us this week. Enjoy the weekend and I hope to meet some of you online tomorrow for the discussions with QOji.
That is it from my end for now

PS: We are planning to make some cosmetic changes to the blog as the readership is increasing and some of our followers are having challenges to download the pages on mobile. So we are planning to eliminate pictures on background etc and change the template to a very simple template without too much color etc; so don't be startled to see plain vanilla pages next week.

1 comment:

deepak said...

NAGI bro ,first of all the cosmetic changes are not going to disturb the gist of the blog , the soul will be still the same.
secondly as u have mentioned this is the 8th consecutive close above 5032,and today as well nifty retraced very nearly from that level, IMHO the big punters will be holding it up till MUHURAT trading and then , i think its anybody's guess.