Trading ideas for 27/09/2011

Trading ideas for 27/09/2011(Tuesday)

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FII DERIVATIVES
Index Future	Index Option	Stock Future	Stock Index
-113	-1200	-89	-16
FII Cash	-1083
DII Cash	+575

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India VIX : 35.43 up by 0.27 points
Call OI : 45552900
Put OI : 50673700
PCR : 1.112
SMR : 31.85

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Intraday support and resistance:

S2	S1	Pivot	R1	R2
4705	4770	4828	4890	4930

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Nifty Open Interest for September stands at 2,16,13,500 down by 20,90,700 with decrease in price (100% Rolled over to October Series with some more short addition)

Bank Nifty Open Interest for September stands at 13,26,550 down by 7,20,475 with increase in price (80% Rolled over to October, and some short covering)

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For 27/09/11 NF may take support at 4800

Above 4845 NF may rally up to 4890

Below 4800 NF may correct up to 4760

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OPTION DATA ANALYSIS


As per OI Table put writing was seen from 4700 to 5000 while call writing was seen at 4600 and 4700. not much aggressive writing. looks like a small pause will be here. NAV effect may play in the coming days so nifty upto 4920 is expected. Nifty covered 20.9 lacs of OI in September but added 23.3 lacs in October, 100% were rolled over, with most probably some more shorts added to October

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Expected Bullish Stocks For 27/09/2011:TATAMTRDVR, DIVISLAB, IDEA, PNB.

Expected Bearish Stocks For 27/09/2011: ABB, AREVAT&D, INDHOTEL .

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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.