Anand Rathi - Daily Fundamental Snippets & Daily Strategist - May 232007

The NIFTY futures saw a rise in OI to the 1.92% with prices up indicating long positions built up in the counter suggesting fresh long positions built up in the market which may further strengthen the market .Market managed to remain above the 4240 levels which may give support to the market. Nifty futures premium disappeared due to liquidation of positions during the last hour and nifty futures closed at 5 points discount to spot nifty .The FII were buyers index futures to the tune of 430 crs and buyers in index options to the tune of 192 crs. The PCR has come up from 1.47 to 1.48 indicates some buying may emerge in the market. The IV is around 20.05 levels indicating some volatile trading sessions ahead.

Among the Big guns, ONGC saw 4.33% rise in OI with prices finally coming down in the and closing near day's low indicating short positions built up in the counter aggressively thus suggesting weakness in the counter . Whereas RELIANCE saw drop of 3.74% in OI with prices moved up and closed near day's high thus suggesting short covering seen in the counter but the built up suggests that their may be consolidation in the counter before taking sharp movement thus suggesting that one should start booking partial profits in the counter.

In the TECH counters, all the majors saw significant built up in OI with prices recovering from lows indicating buying emerging at lower levels which if continues today may force bears to cover their positions aggressively .One should take positions in the IT pack only after looking today's built up and movement in the price .

In the BANKING counters, all the majors saw rise in the positions with prices coming down from highs indicating short positions built up in the counters suggesting some weakness may be seen in the overall BANKING counters.

In the Metal pack, TATASTEEL & SAIL saw marginal rise in OI with prices coming down indicating long positions liquidated in these counters after a sharp rally thus suggesting one should start booking partial profits in these counters. HINDALCO & NALCO saw marginal rise in OI with prices remaining in a narrow range suggesting one should wait for making positions in the counters unless some significant built up is seen in these counters. STER saw rise in OI with prices up indicating long positions built up in the counter.

We feel that the volume and built up in OI suggests that market may show some directional movement as there is good built up in open interest. Market may show further strength and we may see fresh buying emerging in the market if market sustains above 4240 levels One should trade with strict stop losses to be adhered too.

Anand Rathi - Daily Fundamental Snippets, Daily Strategist - May 23 2007