Tuesday, 2 August 2016

Open Interest in 8700 & 8900 Call Options Increases By 7 lakhs & 9 lakhs Respectively!! Is Market Heading Higher Towards 8900??

From last 2 days Market is in a very tight range but cash volumes are above its 10 days average volume. Not only this but kind of open interest addition seen in 8700 & 8900 call options from last 2 days indicates huge volatility is going to come. PCR is at 0.81. This all indicates the market participants are bullish on GST pass in parliament, but what after the event is over. If we see Market has already discounted GST so it could be a sell on & after event  is happened. One thing is clear by data if Nifty manages to sustain above 8700 it could extend rally but hardly 2-3%. If we look at if it has to go down then 8598 is 10 days volume weighted average, below which 8530 is a strong support. If at all it closes below 8500 then we can see fast selling up-to 8300. So conclusion is likely it has to correct but may be before going up around 8800. Till now there is no huge open interest adding in PUT options which does not suggests immediate downside. So Long is intact but with a strict stop-loss of-course. 



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