The market was again trading lower on April 20 amid heavy selling by foreign institutional investors (FII). Traders said every rise was being sold, highlighting the bear pressure.
At 11 am, the Nifty was 0.04 percent down at 17,612 after opening higher. Nifty futures, too, was down at 17,645.
Data shows traders are continuing with the Straddle strategy at 17,600. It means they either bought or sold both put and call at these strikes. The strategy makes money when the Nifty does not move in any direction.
Call writers were seen accumulating positions at 17,650 and 17,700. Traders believe these levels will act as hurdles from hereon, making it difficult for the index to bounce back.
The bars reflect changes in open interest (OI) during the day. The red show call option OI and the green put option OI.
“The sentiment was also dented after FIIs were net sellers in the last two-trading sessions to the tune of Rs 1,357 crore,” said Prashanth Tapse, Senior VP (Research), Mehta Equities. “The technical landscape suggests the Nifty could extend correction and trade volatile with the biggest support seen at its 200-DMA at 17,588 mark. For the index, the key hurdle is at the 17,863 mark.”
Among individual stocks, bears were seen adding to their positions in Divi’s Labs along with other pharma names such as Lupin, Aurobindo Pharma and Biocon. Auto names such TVS Motor and Eicher Motors, too, saw a short buildup.
Page Industries and Trent were on the bulls' radar as they saw a long buildup. Cummins India, ICICI Prudential and Adani Ports also saw bulls converging on them.
A long buildup happens when prices and open interest rise in tandem.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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