Trading ideas for 16/08/2011

Trading ideas for 16/07/2011(Tuesday)



Every rise are been sold. After 5225 yesterday 5120 zone witnessed huge selling and it may act a resistance for bulls still nifty has to take 5210

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FII DERIVATIVES
Index Future	Index Option	Stock Future	Stock Index
-648	+200	+116	+6
FII Cash	-471
DII Cash	+99

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India VIX : 28.78
Call OI : 50705950
Put OI : 47735000
PCR : 0.941
SMR : 28.70
ADV/DEC  555/854

SMA-7: 5158.09   SMA-13: 5307.80   SMA-26: 5451.88   SMA-50: 5475.04   SMA-200: 5661.99
EMA-12: 5256.77   EMA-26: 5376.40   EMA-50: 5449.01   EMA-200: 5548.50   MACD: -119.63

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Intraday support and resistance:

S2	S1	Pivot	R1	R2
5968	5017	5108	5164	5250

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• Nifty Open Interest for August stands at 2,36,78,500 up by 9,93,500 with decrease in price (Short Buildup)

• Bank Nifty Open Interest for August stands at 14,28,625 up by 66,050 with decrease in price (Short Buildup)

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For 16/07/11 NF may take support at 5080

Above 5125 NF may rally up to 5175

Below 5040 NF may correct up to 4970

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OPTION DATA ANALYSIS


As per OI Table call writing was seen from 5000 to 5400 while profit booking was seen in puts from 5000 and higher strikes but puts were added at 4800(could be some one betting on 4800). Highest call option was seen only at 5500 and put option was at 5000. So 5000 may provide some support but FII are not coving much of their short and even when world market are green we finished red which does not look good. If in any case we go near 4800 i may buy some stocks.

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Expected Bullish Stocks For 16/07/2011: GUJFLUORO, LT, ORCHIDCHEM, TECHM.

Expected Bearish Stocks For 16/07/2011: SBI, TATASTEEL, BAJAJHIND, IDFC, INDUSINDBK.

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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.