The September series on Thursday expired on a strong note as the Nifty October futures settled above 5,000 with significant premium to spot. The market undercurrent changed dramatically from bearish on the penultimate day to bullish on the day of expiry, as traders rolled over long positions in the Nifty October futures. The market profile suggested a double distribution day, as other time-frame traders aggressively moved prices higher to another value area because they found prices were at an unfair value during the morning session. The double distribution day is divided by a single TPO and trading between buyers and sellers occurred at that stage.
The bull’s dominance is expected to continue tomorrow as the market picture chart suggested, but the global cues remain an important factor for the market to keep the momentum. The trade summary matrix showed buyers dominance above the 5,000-levels and, hence, there is a possibility of strong opening for the market tomorrow. The 24 per cent volume in the initial balance 4,900-4,945 range, mostly through change of hands, indicated strong support at the lower levels. The October futures closed around the day’s high with 27 per cent volume above the upper band of value area (4,930-5,015), indicating strong undercurrent.
The rollovers in October futures were at a premium and improved significantly from 14.2 million shares to 19.33 million shares, suggesting long rollover. The MKTP chart sourced from Bloomberg hinted at price-based upside around 5,067 and the market remained in the bulls grip. The volume-based surge can take the Nifty around 5,150. The strong consolidation in October futures was seen around 4,995 and hence, the support is expected to come around that level.
The top gainers to the index, Infosys, ITC and ICICI Bank, are expected to help the Nifty to revisit the 5,100 levels. The October futures of Infosys is expected to move up to around 2,607 and get support at 2,535, ITC will move up around 206, Reliance around 824 and ICICI Bank around 903, the MKTP chart suggested.
Long build-up was seen in the 5,000-5,200-strike call options, as traders expected strong momentum in the market in the new series. The change in sentiment from bearish to bullish has also been indicated by the short build up in the 4,800-5,000 strike-put options.