Nifty Feb rollover numbers hint sharp downside unlikely

Nifty futures rollovers to the February series were the lowest since August 2017 in percentage terms ahead of the interim budget on Friday. Traders unwound short positions in the index contracts, indicating they do not expect sharp downside in the February series.The Nifty ended up 1.7 earnings on the expiry day (Thursday) on short covering amid dovish commentary on rates from the US Federal Reserve, but the index ended the series with gain of just 0.5 earnings. Information technology companies, PSU banks and private sector lenders saw rollover of long positions into the February series while more of the short positions got rolled over in the metal sector.“Nifty future has seen rollover of 61.84 earnings with roll cost of 0.23 earnings. Nifty future has seen the lowest percentage rollover in last 17 months since August 2017 as the index got stuck in a range and everyone is waiting for the Budget," said Chandan Taparia, derivative analyst at Motilal Oswal.Besides the Budget, the RBI policy on February 7 and the remaining earnings announcements for the December quarter will dictate trend in the February series.“Short positions have got cut this time, partially,” said Amit Gupta, head of derivatives at ICICIdirect.While analysts expect the index to trade with a positive bias in the series ahead, they do not expect a sharp upside either. The Nifty is seen facing immediate resistance at 11,000.In the Nifty options table for February, the maximum open interest build-up in Nifty call options is at 11,000; and among the put options, the highest concentration is at 10,700.“If post the interim Budget outcome the index manages to decisively give breakout above 10,985, then the rally could extend to 11,176 and 11,333; while below 10,650-10,600 zones only bears could get grip which is a major support zone,” said Taparia.The 11,000 level for the Nifty has proven to be a decisive resistance in the near term and the range-bound situation may not change till the general elections, said Edelweiss Securities.Post April, there may be an upward trajectory in the Indian market, the brokerage said. 67779633 67733345

from Economic Times http://bit.ly/2t3csDX