Market expected to consolidate around 6,200

As expected, the Nifty November futures reached the 6,205 target and closed at 6,193 on profit-booking at higher levels. The market is expected to consolidate around 6,200 and will lose steam only if Nifty futures fail to maintain support at 6,150.

Now, the market is awaiting the second quantative easing in the US for guidance on the break-out direction. It is expected that the Fed will not disappoint and will deliver positive vibes, if not a feeling of awe, says J Moses Harding, head of global markets group, IndusInd Bank.

The initial balance range, the first two time-price opportunities (TPOs) time periods established by the liquidity providers, saw change of hands and significant buying by top traders. The IB range (6,180-6,210) saw 95 per cent volume and TPO counts, which suggests the market is consolidating around this range. The Nifty has closed within the value area with 64 per cent volume in the price range (6,193-6,205) established by the point of controls.

The market picture chart for the day indicates no significant upside with volume-based target of 6,225. The TPO data suggest support at 6,117.50. The trading data for the day hint at resistance of 6,215 tomorrow. There was short-covering in the November futures, which closed at a premium to the spot and shed 189,900 shares in open interest.

The November futures has been trading at 30-35 points premium and has shed more than three million shares in open interest since the beginning of the new series. This signals strong undercurrent in the market.

The call option participants covered short positions in the 6,100 call and booked profit in the 6,200-strike call options. This means options traders expect 6,100 to act as a strong support and profit-booking above 6,200. The 6,300 call options saw change of hands from sellers to buyers, mostly to hedge short positions. The 6,100 and 6,200 put options together added two million shares in open interest through sell trades, indicating support levels for the Nifty going ahead.

Among stock futures, State Bank of India rose 1.75 per cent on short-covering at higher levels. The November futures of SBI closed at Rs 3,279 with 77 per cent volume above the IB range. The TPO and volume picture chart suggests an upside of Rs 3,306 for the November futures. Support is expected around Rs 3,197, the market picture chart suggests.