Most of the private sector banking stocks are carrying relatively higher open interest into the October series. These short positions will be prone to be closed if Bank index surpasses 24,500 level.
The Nifty is trading near crucial support of 9,700-9,750 levels. If the index spends more time above these levels, the market can witness the closure of short positions rolled into October series.
Roll spread of Nifty Futures declined from 40 to 20 points in the settlement week. This shows the short rollover of Nifty Futures. In addition, the lower premium of only 14 points in Nifty futures also suggests shorts have been formed.
The highest options base is placed at 9,700 Put and 10,000 Call strike. Looking at the increased Call activity at 9,900 strikes, the immediate range is 9,700-9,900 for Nifty.
The foreign institutional investors (FIIs) have been regularly selling in cash segment since September 19. Their higher selling figure of Rs 5,000 crore on September settlement has close to Rs 2,400 crore of Nifty rebalancing figure.
Three stocks replaced 4 stocks in Nifty post expiry day.
The buying from MFs has increased near 9,700 level in the last few sessions. The same pattern was seen in the month of August when Nifty reached these levels.
If the FII selling reduces, this buying from MF can lift the markets once again.
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