The Nifty is already trading below its 20 and 100 day moving-average. It will be interesting to see if it can take support from its 200-day moving average, which is placed around the 11,140 level.
Last month, the Nifty closed on a positive note similar to the manner it closed in the first week of July, but it could not cross the psychological level of 12,000 and profit booking was seen at higher levels. The downtrend continued during the month over weak global cues and lacklustre quarterly earnings, which led the market to correct by around 5 percent.
Smallcaps and Midcaps underperformed in comparison to their benchmarks, and both indices closed down by 8-9 percent for the month.
This is the third consecutive month where Foreign Institutional Investors (FII) are net sellers in the market, and the current month's net outflow is the highest in last nine months.
In the budget, which was announced at the starting of the month, the Finance Minister continued to focus on fiscal consolidation. With growth slowing down to 6.8 percent YoY in FY19, and is expected to remain somber, no radical measures were announced in the budget to stimulate growth.
Coming to specific sectors, pharma was the least hit during the month as it is down by around 1 percent, while auto is the worst performing sector as it fell by 13 percent. Banks, IT and metals fell by 7 percent, 3 percent and 9 percent respectively.
From a rollover point of view, the market-wide rollover was at 91 percent, as against a 3-month average of 88 percent, which made it the highest market wide rollover in last 12 months. The Nifty rollover was at 74 percent, as against previous 3-month average rollover of 78 percent and Bank Nifty's rollover was at 77 percent as compared to last 3-month average rollover of 80 percent.
As far as the August series is concerned, the Nifty would be opening with 7 percent lower open interest (OI), and a 20 percent lower open interest in Bank Nifty, but an open interest higher by 3 percent can be seen market-wide. Sector-wise, a higher rollover was seen in auto, metal and IT stocks, while poor rollover was seen in telecom and infra stocks.
The monthly option concentration for Nifty is highest at 11,000 Put option and 12,000 Call option. There is some good OI build up at 11,200 Put option and 11,500 Call option, which suggests that the near term range for Nifty will be 11,200-11,500.
The Nifty is already trading below its 20 and 100 day moving-average. It will be interesting to see if it can take support from its 200-day moving average, which is placed around the 11,140 level. If the Nifty breaks the 200-day moving average, then we may see another round of selling in the market.
The author is AVP (Derivatives) at Emkay Global Financial Services.Disclaimer: The views and investment tips expressed by investment expert on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Subscribe to Moneycontrol Pro and gain access to curated markets data, trading recommendations, equity analysis, investment ideas, insights from market gurus and much more. Get Moneycontrol PRO for 1 year at price of 3 months at 289. Use code FREEDOM.