Nifty futures see higher rollover

F&O OUTLOOK

The Nifty lost 30 points over the day to close at 5,137 after opening firm at 5,200 and touching an intra-day high of 5,251. On expected lines, the bears struck back at higher levels with fresh short positions.

The Nifty February futures closed at a discount of 54 points, while the open interest (OI) increased by 10.18 million shares to 36.81 million shares, indicating the rollover of short positions.

Technically, the decline is on account of the bearish 'Triangle' pattern breakdown on the hourly chart, which is yet to achieve its target. According to a technical analyst at JM Finance, the US market technical set-up calls for further a correction in the range of at least 17,000-17,300 for the Sensex and 5,000-5100 for the Nifty.

According to a derivatives analyst at Angel Research, market participants are still hunting for stability and are divided on the direction of the market, which is evident from the FII statistics.

In the index futures, apart from rolling over their positions, the market players are taking fresh positions, which is evident from a significant rise in the open interest.

The rollovers in the Nifty futures were higher with the open interest in the Nifty February futures at 36.81 million shares, higher than 31.37 million shares rolled over in the January futures.

The rollover in the stock futures remained poor at Rs 33,314 crore (Rs 67,698 crore at the end of the December expiry) on account of the covering of speculative positions during the recent meltdown.

As expected, the Nifty roll cost (cost to the short roller) has expanded from 12 points on Monday to 54 points on Thursday on the back of aggressive short rolling (either hedge positions or directional short).