India Morning Report: Expiry becomes a battleground again over the next trend change

Of course that happens at PCR saturation at least in this case and with a PCR low, it was unlikely that market would not simply stick to 5400 itself . However imbalances have been accentuated in techincals because of the gap in fundamentals perceived by India buyers and India sellers, short trade seeing a saturated market even below 5000 when it reaches that level and IT looking pristine as one mostly realises the positive correction is temporary. Long positions are not exiting India as a more than improbable bounce is just around the corner with no policy measure untouched and no fundamental reason or a continuing run on India.

Again on the other hand, there will be another run ofn the ruee and though people may be prone to stop at the consensus opinion of 70 there is more than a case for a run with double the range of the lst box of 64-68 making a single push on 70-78 levels, before buyers have more than a perfunctory interest in the levels of the rupee reached.

The new RBI FX window for Oil purchases will probably signal long term good as large Oil purchases hve even now been independently flagged but the average offshore speculator remains opaque without any formal signal on bulk trades as possible thru the RBI FX window much like the know RBI window in closing where again the currency is left alone.

The fixed income markets including sovereigns surprisingly , refuse to lead the trend back still waiting. If it is for policy inaction then the rupee downgrade is even more likely here as the execution is obviously suspended to post General elections. The BankNifty (Bifty) is a yummy ick at 8800 and ne hears rollovers are happening more freely this expiry. Earlier best levels maybe did not exceed 60%

SBI is over priced at 150 and I would root sellers till 1250 before I read th market tea leaves. Stop loss it around 1550 as the move trades could come and go and many biggies bankroll themselves on their large cap holdings. Vix at 31 is not the peak and there fore another 20% uptick on the Vix is pobably a given but expiry maybe around the 5300 levels for rollovers continue all day

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