Trading ideas for 11/08/2011

Trading ideas for 11/08/2011(Thursday)

Above 5210 nifty will test 5400 below 5040 nifty is very week

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FII DERIVATIVES
Index Future	Index Option	Stock Future	Stock Index
+1528	+243	+216	-5
FII Cash	+152
DII Cash	+289

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India VIX : 28.78 up by 3.88 points
Call OI : 49106700
Put OI : 48227800
PCR : 0.982
SMR : 29.48

5DMA=5177
20DMA=5459
50DMA=5490  
200DMA=5670

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Intraday support and resistance:

S2	S1	Pivot	R1	R2
5084	5126	5160	5198	5236

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NIFTY Future closed at 5158.65 (Rs. 2.35 DISCOUNT) with a turnover of Rs. 13542.47 Crores.
Sheds 1063300 shares(-4.49%) in open interest bringing down the open interest to 22631150 shares. ( Some more shorts were covered)

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For 11/08/11 NF may take support at 5170

Above 5210 NF may rally up to 5275

Below 5140 NF may correct up to 5090

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OPTION DATA ANALYSIS

As per OI Table 5000 is getting close to 8C mark and will act a support for this series while strong resistance comes only near to 5450. 5000, 5100 puts were written while 5200 and 5300 calls are written in small quantity.  

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Expected Bullish Stocks For 11/08/2011: CHAMBLFERT, MARUTI, BAJAJHLDNG, HOTELEELA, VIPIND.

Expected Bearish Stocks For 11/08/2011: IOB, POLARIS, SUNTV.

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NIFTY VIX

• VIX above 60 are dangerous levels. Markets will be highly unpredictable. If Markets are on a high (Nifty P/E above 24), then its advisable to exit the markets completely. Markets may be hot and totally bullish, but will most likely face a darker correction. Its just a question of time.
• VIX below 20 mostly indicate a more stable markets, purely because the volatility is less. It does not mean that markets wont fall. It just means that markets will follow predictable fundamental supports and resistances.

SMR = Smart Money Ratio (India VIX / PCR)

SMR is a measure of fear in the market. A value of less than 20 indicates that market is lack of fear and volatility and the higher PCR ratio(greater than 1) supports such kind of action. And a value of 60 or greater than 60 indicates too much of fear in the market which is highly motivated with lower PCR ratio (less than 1). It is a kind of indicator which provides information about which kind of market we are right now.

Put/Call Ratio

Put/call ratio (or put-call ratio, PCR) is a technical indicator demonstrating investors' sentiment.[1] The ratio represents a proportion between all the put options and all the call options purchased on any given day.

The market has bottomed when PCR was around 0.8-0.9 and topped when it was 1.2 or above.

HOW TO INTERPRET THESE VALUES

SMR with a value less than 15 indicates the market is lack of fear and volatility and along with high PCR ratio more than 1 supports such kind of action. And a value of more than 25 indicates too much of fear in the market which along with lower PCR ratio of less than 1 confirms it. It gives the mind of players in the market.