Mkt not ready to dip too much now

The US is up a bit in the green, Asian markets are generally green all around; crude is behaving itself at USD 130 to a dollar, a bit better and today is the last day of the May series.

It’s not been a good series for the market, it’s not been dreadful - but it’s not been as good as March and April. So let’s see whether we can close off the May series with a bit of strength today.   

I think some of the shorts got closed out yesterday. The view seems to be that the market is not ready to fall off too much more just yet, so you could see an attempt to close the expiry around that 5,000 kind of mark. What happens after that, depends on how the macro shape up, which have not been very encouraging so far. So it looks like at least in morning;  we’ll attempt some strength. Let’s see how we can close it off today but June should start off with a fairly significant kind of OI of 60,000 crore but we’ll find out.

On Asian indices:

Asia is not a bad picture this morning. China is in the red but Japan is having a very handy rally of course for reasons, which are unique to that market. Korea is up 1.5%, and other markets are okay. But generally there is more green than red, which is quite comforting.

On yesterday’s takeaways and expectations from today:

What we saw yesterday had to happen because the market was getting sold down quite swiftly. The fall from more than 5,200 back down to 4,830-4,840 was quite swift. So we lost 6%-7% very quickly and inevitably particularly around F&O expiry these often tend to snap back quickly because the shorts tend to cover up. So, yesterday morning was an important test.

Everybody was watching if the market had more downside and the force would take it down to sub-4,800 levels. There was an attempt in the red early in the morning but that did not lead to any further deeper cuts in the market, and therefore the bears also sort of figured out that for the near-term it might be done and quickly cover up their positions. So you saw a bounce and that has led us back to 4,900.

Today we might see a little bit more of a push up in the market at least in the first half of the session. These things happen around settlement, which will probably take us, back to close to that 5,000 kind of levels more than 4,950. The bulls will try and effect a closing very close to that 5,000 mark today. Let us see if they are successful in doing that. There could be volatility along the way because the fundamental newsflow has not been very good these last few days. But we are getting to that tussle kind of zone once again in that 5,050-5,100.