And Weakness Continues

Hi,
And Market weakness continued with FII selling for the second day to the tune of 683 crores.
FIIs sold 13.66 lacs of Nifty and Nifty Open interest (compounded 3 months) increased by 3 lacs suggesting that Retail players are taking Long positions to the tune of 16.6 lacs.



FIIs were Net seller too in Index option segment and buildups in Calls in the box above clearly shows that shorts are building in the market.


Daily Charts of Nifty again showing significant short buildup and volume and MACD giving a clear cut sell signal and move below 5200 in coming days will confirm in down leg.


Review of My FNO stocks given so far:

BajajHindustan though exited on the yesterday itself but clearly said that any addition to the open interest will be bullish in nature and my decoding confirmed by stock falling a little bit with decrease in open interest (see futures OI table below). A cut of .75% in Open interest suggest that Long positions are on hold for the time being, unless we see a green day longs should be avoided and keep an eye on open interest as addition can give a decent 8-10% move upside.



Polaris

Polaris added 6.5% in open interest with price touching 164 Rs 10 Rs made so far with no hiccups. Unless we don't see a major unwinding keep shorts intact.

RECLTD

RecLtd surprised today with addition in open interest and a call coming from India Infoline to go long @ 253 for target 251. Call came when addition was seen at 1.5% in open interest and intra OI was at one point was around 6%, but at End of Day OI was net 1%+ so doesn't give much conviction to go long in this scrip.


Educomp:

Educomp had a nice buildup but today 2.75% short covering in open interest was seen, and it was actually expected as huge buildups like 15-20% next days mostly results in covering (A perfect example was Tata Motors recently) but on charts Educomp is still weak and can be shorted with increase in OI.


Hope you liked it.
Happy Trading!!