Cast of Carry on Nifty Futures

Market opened at flat in the morning at 5480 levels, But as the news of Left thrown out from kerala and WB Market reacted in a positive way and moved till 5560 till 12:00. With Europe Opening in Positive and News of interviews related to more Reforms led the market to cross 5600 Levels and after more than one week NIFTY quoted at 15 points premium to Spot, which is good sign that people are buying.

By 3:00 Traders started to exit there positions to gain from 100 points rise and market cracked a bit , but what is surprising is the premium at which NIFTY is Quoting to SPOT at close

Nifty Futures were Quoting at 5580.85 at close while Spot is 5540 a 40 points premium which is never seen by me .Does it mean Market will go up in coming days? lets see how it unfolds in coming days.

But what is surprising more is the Cost of Carry which is at 8.1 which led me to this post


Theoretically The Futures Price = Spot Price + Cost of Carry.

Looks like Theory is thrown in dustbin for today :)

Will post more once my blogger is up



Thanks
Pradeep Reddy Lekkala

http://www.plekkala.com/

Nifty in Coming Days

Here is the analysis of Nifty in coming days after today's expiry.
On the Options front we can see lot of unwinding happened at 5800 and 5900 PUTS in April Series. Going forward to May series Traders made positions at  5700 ,5600 PUTS means in coming days market might reach these levels on Downside  with Huge OI at ,5600 PE  levels means we have Strong Support at 5600 in coming days  and  on the Upside we have 5800 ,5900,6000 Call Writings, With huge OI at 6000 CE levels means 6000 will act as Strong Resistance for the next week

Volatile Trades on SGX

 Something unusual happened on Nifty Futures Traded at Singapore Exchange, There are couple of volatile trades can be seen from the high and low prices registered .As today is expiry for derivatives one can expect market to be volatile but +5% to -5% a swing of 10% on a normal day is bit abnormal. We will see if we can get any information from google on how those trades happened. I will be crossing my fingers as am having a one side position on market

SGX QUEST Trading Hours: Mon-Fri 9.00am - 6.15pm
SGX QUEST (T+1) Trading Hours: Mon-Fri 7.15pm - 1.00am

	Contract Month	Last	Chg From Prev Settle	Bid	Ask	Open	High	Low	Close	Vol	Open Int	Prev. Day Settle	Settle
E	Mar  11	5,538.50	+35.50	5,537.00	5,538.50	5,524.00	5,799.50	5,273.00	-	12,271	216,849	5,503.00	-
E*	Mar  11	-	0	5,483.00	5,650.00	-	-	-	-	-	-	-	-
E	Apr  11	5,551.50	+29.50	5,556.00	5,559.50	5,539.00	5,587.50	5,500.00	-	1,602	1,521	5,522.00	-

Market Direction in the New Year

Markets went into New year in good move. Nifty started 2010 at 5200 and ended at 6134 primarily because of global recovery and its impact on domestic recovery (consumption,manufacturing,imports etc..) and Strong FII flows into EM's which gave an 18% Return.

Nifty Started Jan Option Series with a Good move on  Friday. A Lot of PUT Writing Happening at 6000 Levels and can safely say for now that 6000 is good support for the upmove which  started from last week.

Good amount of CALL Writing also happened at 6300 levels which clearly acts as resistance for now. Also on 31st December PCR value is 1.29 for Index Options which indicates a lot of PUT writing happening when compared to CALL writing and NIFTY is in upmove atleast in the near term say for the next 1-2 Weeks.

Another interesting thing in the current series is NIFTY Rollover seen at 61.2 % which is very low compared to previous month of  75 % and rollover numbers say that not many participants are taking the positions which they had in December. But overall JAN Market wide rollover is at 84.5% compared with 85.5% in DEC Rollover and that looks like a good sentiment in contrast to Index Rollover positions.
Once the inflation numbers comes up next week and if that is in uncomfortable range then RBI will be going for Rate Hike which might hamper the sentiment on the street.

Call writing is a branch of options trading strategy involving the selling of call options to earn premiums.
Put writing is a family of options trading strategies that involve the selling of put options to earn premiums.

Economic Growth and the Policy Imperatives--by Dr. K.C. Chakrabarty

A Very Good Article by Dr. K.C. Chakrabarty on Prospects for Economic Growth and the Policy Imperatives for India. Here he talks about the past,present and future growth of Indian economy.

• The transformation to the high growth phase
• The impact of the crisis & the V-shaped recovery
• The near term growth prospects and the challenges 
• The long-term growth prospects
• Making growth process more inclusive.

I had a question for him..from 1991 BOP to 2007-08 Recession..by seeing at the instances of Rise and Fall of economy is it possible  for the Central Bank to Foresee the Problems in economy. If yes when are they likely to turn up...if not then when is that you people are going to create :)

The Last statement in reference to my conclusion of recession.. "Root cause of  Crisis in west is by investing money into Real Estate as if real estate prices never come down,,,,and now see what happened over there....And i believe the same thing is happening over here now.. people speculating that real estate value will always go up...and investing as if there is no tomorrow...and RBI is not interfering to arrest the up move" ..Will see how it turns up in coming years :)