F&O expiry 6 Oct- Nifty support at 16500, avoid aggressive bets, focus on stock-specific action; RBI MPC eyed

F&O expiry 6 Oct: Nifty support at 16500, avoid aggressive bets, focus on stock-specific action; RBI MPC eyed

By Sameet Chavan

Our market has seen an optimistic start with a decent gap up, wherein the benchmark index NSE Nifty 50 tested the 17000 mark at the opening bell on Thursday. But soon after, a sell-off got triggered that gradually dragged the index below Wednesday’s low, signifying the strength of the bears at higher grounds. With the intense day of sell-off, Nifty continued the selling streak for the seventh day in a row and settled a tad above the 16800 level with another cut of 0.24 percent.

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FIIs were net sellers in the cash market segment to the tune of Rs 3,599 crore. Simultaneously, in Index futures, they sold worth Rs 1,007 crore with significant fall in open interest, due to the expiry. Recently, we saw a blend of short covering and long unwinding in both the key indices. Rollover in Nifty and Bank Nifty stood at 78% and 82%, which is slightly lower as compared to previous series. Stronger hands continued to curb liquidity and preferred rolling over bearish bets in the index futures segment. On the options front, 16500 put and 17000 call strikes are attracting traders’ attention.

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Going forward, the RBI monetary policy is lined up today; hence, traders should keep a close eye on the event. Apart from this, global development should also not be overlooked, and therefore, one needs to avoid aggressive bets and focus on stock-specific actions.

(Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One. Views expressed are the author’s own.)