By Ajit Mishra
The January series Nifty futures started with a premium of around 220 points. The Nifty rolled around 80% and Bank Nifty around 81%. For the Index futures, FIIs have increased the long positions to 70% from 36% at the start of the January series.
The Index is now likely to consolidate till 21500 is not breached on a closing basis, for the first fortnight of the December series.
21500-21550 might be the immediate support and only a decisive close below it might bring in further downside.
VIX for the Nifty is currently at 14.5 and likely to remain in the 12 to 16 range implying a range of around 800 points.
FIIs started this series with Long position in Index futures of around 70% vs 36% last month, which are currently marginally down to around 69% shorts.
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For the Nifty, the IVs for the options remained around 14 levels in yesterday’s trade. For the Bank Nifty 25th January, 48000 strike Call option has huge open interest implying resistance at around 48400-48500. For the Nifty, the VWAP (Volume weighted average price) of January Futures is around 21500 implying that to be the support.
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Above this, Nifty is to be positively biased for the short term towards 21800. With FIIs marginally reducing their long positions, we expect Nifty could consolidate between the 21500-21800 levels.
The ratio between Bank Nifty and Nifty is currently at 2.21, this ratio has a support at 2.19 and resistance near 2.28. We expect Bank Nifty to underperform the Nifty this series.
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Sector-wise, Pharma and Chemicals look good in Nifty.
Nifty Call Spread:-
Sell Nifty 4 JAN 21600 CE @ 120
Sell Nifty 4 JAN 21600 PE @ 100
Spread @220, SL @ 270, Target 120.
