Epicresearch Daily Derivatives Market News Updates On 16 January 2015

MARKET ROUNDUP
The market were in for a huge surprise this morning after the RBI (Reserve Bank of India) cut the key repo rate by 25 basis points, out of turn, to 7.75 per cent following a slew of positive macro-economic data.
This was the first rate cut by the governor Raghuram Rajan. Although the move came as a surprise, but the Central Bank head had hinted in his December policy review, that RBI may act out of turn in case inflation remains under control.

F&O HIGHLIGHTS
The Nifty opened gap up as the RBI pulled in a surprise by cutting the repo rate by 25 bps to 7.75%. Banking, rate sensitives moved up sharply leading the index to end up over 200 points. India VIX increased 6.3% and settled at 16.16
FIIs bought 1738 crore while DIIs sold 527 crore in the cash segment. FIIs bought 3897 crore in index futures and 3600 crore in index options. In stock futures, they sold 290 crore
The highest Put base is at the 8000 strike with 66 lakh shares while the highest Call base is at the 8700 strike with 49 lakh shares. The 8600 and 8700 Calls saw addition of 15.65 and 11.35 lakh shares, respectively. The 8400 and 8500 Put strikes saw addition of 29.41 and 18.35 lakh shares, respectively

INDEX OUTLOOK
Nifty Future: The Nifty is likely to open flat to positive on the back of mixed global cues. It is likely to trade in the range of 8455-8530
Bank Nifty Future: Aggressive unwinding of short positions was seen as the index managed to surpass the hurdles of 19000. Any dip towards these levels would provide a cushion as sizeable positions are still open in 19000 strike Call.

STOCK ANALYSIS
OI addition : We saw long built up in Tcs, Voltas, Hindzinc, Idfc,Bajaj-auto short built up was seen in Federal bank, Bhel, Hindalco, Mrf, Bataindia
OI Shedding : We saw short cover in Andhrabank, Igl, Orientbank, Sbin, Relinfra, Ioc while long unwinding seen in Dabur, Arvind, Wockpharma,Bharatforg, Mindtree

OI Chart Analysis: From the OI Chart we can see that in January Series addition of open interest on the calls front is existent in the band at strike price of 8500-8600 indicating it as resistance on the upside whereas on the put options front we can see that addition of open interest is existent at strike price of 8200-8100 indicating it as immediate support zone on the downside

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