Market Snapshot
Yesterday, the Sensex opened with a positive gap 35 points at 13,343, but slipped to a low of 13,197. The index, thereafter, exhibited a range-bound movement with a negative bias for most part of the trading session. Some volatility towards the end saw the index rebound and rally to a high of 13,387. The Sensex finally ended with a marginal loss of 22 points at 13,286.The index has now broken its five-week losing streak, and finished the week with a gain of 856 points.
The NSE and BSE cash volumes were higher compared to the previous day at INR 82 bn and INR 40 bn respectively. The F&O volumes were lower at INR 337 bn.
Sentiment Indicators
The Implied Volatility (IV) across Nifty strikes has decreased to 24-30% levels. The WPCR of Nifty Options increased to 1.03 compared to the previous day while the 5 day average is 1.08.
Outlook
The markets are expected to remain positive and move in a range in the absence of negative global cues. Nifty is expected to inch upwards on back of long rollers coming into the market more aggressively and expected buying by domestic mutual funds to prop their NAVs towards the year end. Nifty has an immediate resistance of 3900 which is 50% retracement level of the recent fall.
Nifty rolls have not yet picked up and are at 26% levels compared to 36% levels. We suggest short rollers to aggressively participate at -4/-5 levels. On the long roll side, we expect the levels to further contract. The IVs also saw a fall indicating easing concerns of fall in the immediate term.
In shorter term the Nifty has a support at 3824 followed by 3792 while the resistance is at 3900 followed by 3950.
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