By Gaurav Arora
The April series Nifty futures is currently trading with a premium of around 70 points which was >150 at the start of the series.
For the Index futures, FII Net Index Long exposure is at 45% which is more or less stagnant since the start of Mar series.
After a good run-up, some profit taking or time-wise correction can’t be ruled out, however we believe Index may continue finding support around lower levels.
21,300-21,400 might be the immediate support and only a decisive close below it might bring in some downside.
VIX for the Nifty is currently at around 12 and likely to remain in the 11 to 14 levels implying a range of around 700 points in a month.
For the Nifty, the IVs for the options remained around 13 levels in yesterday’s trade.
For the Nifty, the VWAP (Volume weighted average price) is around 22,450-500 implying that to be the support. Below this, Nifty is to be negatively biased for the short term towards 22,150-200.
The ratio between Bank Nifty and Nifty is currently at 2.14, this ratio has a support at 2.06 and resistance near 2.20. We expect Bank Nifty to continue its outperformance w.r.t Nifty going forward.
Sector-wise, Auto and Banking look good in Nifty.
Nifty Calendar Spread:-
Sell Nifty 18 Apr 22,600 PE @ 85
Buy Nifty 25 Apr 22,600 PE @ 123
Spread @38, Stop Loss – 8, Target -72
(Gaurav Arora is a Derivatives Analyst at Religare Broking. Views expressed are the author’s own. Please consult your financial advisor before investing.)