The Nifty achieved the target of 3,100 in the morning session, but witnessed profit-booking thereafter and closed the day at 2,954, declining by 87 points. The buyers of 3,000-3,100 calls were seen booking profits, while fresh put writing was seen at 2,700-2,900 strikes. This suggests that the Nifty is expected to trade below the 3,000-mark, with support moving downwards from 2,900 to 2,700, if the current upmove gets aborted.
We had indicated that the current uptrend would be intact if the 2,950-level is maintained at the closing hours of trade. The spot Nifty closed at 2,954, marginally above the support level, while December futures closed below at 2,948. There could be a trend reversal if the Nifty breaks and closes below 2,950. Support for the index is seen at 2,860. The Nifty has a huge put open interest (OI) build-up at 2,700, indicating that the index may end the December series above this level.
Nifty December futures witnessed a decline in the OI by 1.58 million shares and closed at a discount, indicating unwinding of long positions. Traders booked profits in Nifty futures in the first hour of trade and created some short positions during the closing hours of trade. The order-book position at the day’s close was dominated by sellers rather than buyers, indicating a weak opening for the market tomorrow.
Satyam Computer Services tumbled 30.2 per cent to a four-year low of Rs 158.05 as investors went for delivery-based selling in the cash segment and created short positions in the F&O segment. December futures of Satyam Computer added an OI of 4.63 million shares, while its January futures added an OI of 1.83 million shares, mostly as a result of a short build-up.
An uptrend in Reliance Industries (RIL) was halted On Wednesday as its December futures witnessed profit-booking at around Rs 1,340-1,360. The Bloomberg data indicate that almost 33 per cent trading in December futures took place in the opening session and mostly through sell orders. RIL futures closed 4 per cent lower from their day’s high and added an OI of 1.33 million shares.
