Anand Rathi - Daily Strategist

The NIFTY futures saw a gain in OI 2.0% with prices closing at 3610.0 indicating that lot of short covering happening initially & new shorts took place as market moved on with volatility as finally foreign markets recovered which forced bears to cover their positions and weak longs liquidating their positions as market recovered We feel that till the market doesn't sustains above 3750 levels we may not see aggressive short covering and fresh money coming in the market.

The nifty futures discount narrowed again indicating aggressive short BEING BUILT UP .The FIIs were buyers in futures to the tune of 1041 crs .The PCR has come DOWN from 0.95 to 0.91 levels indicating some RESILIANCE in the market .The volatility has come UP from 30.80 to 31.50 levels indicating some un-certainty in the market.

Among the Big guns, ONGC saw gain of OI to the tune of 4.25% with prices coming down 0.54% indicating long positions are liquidated in the counter as the counter moved down not showing much of strength whereas RELIANCE saw gain of OI to the tune of 2.91 % with prices coming down by 0.71 % indicating that the counter saw lot of short positions in line with the market.

On the TECH front, TCS, INFOSYSTCH, SATYAMCOMP, WIPRO saw rise of OI with sharp fall in prices indicating lot of short positions being built in these counters performing in line with market.

BANKING counters saw gain in OI with prices going down indicating that shorts positions being built and fresh long positions liquidated in the counter which may give some support to the falling markets whether be P.S.U'S or P.V.T banks.

In the METALS like other sectors across the board selling took place and without exceptions as all stocks were hammered to pulp by the bears as if we had no tomorrow, however we saw lot of short coverings in HINDALCO at the fag end of the market.

Considering the overall recovery in the market after the initial rise and later the massacre and which was respite by a pull back at the end, we feel the temporary worst would be over if the markets close today in the positive , we could feel comforted , however traders are still warned and buying with strict stop losses is the need of the hour.


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