Participant Wise Open Interest Analysis - 12th Jan

Idea

Likely Movement of Nifty and Bank Nifty:

Clients remain trapped on index front with losses in case of sharp movement either side
DII are hedged smartly and happen to lose half in case indices go up and earn double in case indices fall.
Even though FII are fully hedged against any fall in indices, their best interest still lies in keeping the market up
Pro are set to keep indices contained at least till weekly expiry and then will know how their open interest built up changes for further direction in indices.

Likely Movement in Stocks:

Clients do carry naked longs in stock futures. This tells us that rotation will continue.
In spite of having most of their longs covered, the stock futures long of 700k is still the only thing keeping bears at bay.
DII remain largest shorts in stocks which is dismissed as hedge.
Pro even though are looking to keep stocks also contained, they have an interesting hussle going on with clients on stock options front.

Posted Jan 12, 2021, 5:10 PM UTC