Nifty rollovers point to good prospects in November

Our Bureau Chennai | Updated on November 01, 2019

The rollover of Nifty50 futures signals that November may be a good month for index traders. The Nifty50 futures saw a rollover of about 84 per cent, against the three-month average of 75 per cent. The rollover figure hints that longs’ open interest positions have been rolled over to the November series.

The Bank Nifty saw a rollover of about 64 per cent, which is almost the three-month average.

October was also the first month for complete physical delivery of single stock futures (SSF). However, SSF also witnessed a healthy average rollover of 91 per cent, with most counters seeing long rollovers.

The Nifty closed the October series with a gain of 2.7 per cent, while the Bank Nifty ended with a gain of a mere 0.2 per cent.

On the options front, maximum open interest for puts is at 11,600 and calls at 12,000. The options band signifies an immediate trading range between the 11,600 and 12,000-12,100 zones.

According to Dolat Capital, a good amount of short covering was done by FIIs in index futures. Net index shorts now stand at 22,000 contracts, compared with 49,000 contracts last time, it said.

FPIs’ net longs on SSF now stand at a high of 4.05 lakh contracts.

According to Bhavin Mehta, VP-Derivatives Strategist, Dolat Capital, key concerns are high open interest concentration at the 12,000 CE strike and the volatility index, India VIX, which still remains above 15.

“We don’t see any major shorts, at least from the top 10 (weight 61 per cent) Nifty heavyweights, except for Infosys and ITC (combined weight of the two is 11 per cent). Thus, eight of the top 10 Nifty heavyweights (weight @ 50 per cent) remain on the long side,” he said, adding, “Diwali can be the base, so that Christmas can be celebrated at life-time highs.”

Rahul Mishra, AVP (Derivatives), Emkay Global Financial Services, said, “In the absence of any major negative surprise, we may see the Nifty crossing the 12,000 level in the coming month.

Published on November 01, 2019

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