Fno Datasheet Weekend Update

My Notes:

1. I have said in my last notes that we are going to touch 4900 or 5300 soon. I stated that 4900PE buying and DII equity selling are my reasons for thinking that we are closer to the top then. Hope the food is tasty. :)
2. We are into relent less selling and 500 points down on NF in the week. In the last 5 trading days, FII have net sold 1.2L contracts of NF worth 3K crore approximately. We have to add 2000 crore worth of equity selling to that - it shows that FII are withdrawing money big time from the Indian Markets.
3. The option table is undergoing a real transformation - with each day one CE level is targeted with huge volumes of writing and the strike is giving way to much lower strikes.
4. Talking about supports and resistance based on OI at this stage is not quite relevant because, with the kind of mayhem going on, no strike is safe. All this happening with VIX below 27, and with no strike having 80L+ OI is what is making this interesting. 
5. I have stated in my last notes that 2.2 crore contracts have been added to Nov series in the price zone 5100-5200. I said that there will be violent reaction any time the price hits the zone. Now, in the last one week, approximately 30L contracts only have been reduced. That is a very low 12%. It basically means that, most of the additions in the zone are still trapped in the system. Now, that leads to the following possibilities: Firstly, they are shorts and they are enjoying the fall. I give this possibility minimal chance because after the addition of OI, NF rallied for around 200 points - and not much reactions were visible during the rally. Secondly, they are long but completely hedged with some PE. I give this the maximum possibility. Thirdly, the longs are caught completely off-guard, and they still have not reacted. If they run for cover, we might be in for another 200 point fall. I give this also minimal chance - because, the fall so far has been 250 points from their zone, and at any scale, that is huge and the manic running should have started by now.
6. Out of 30L OI reduction in the last week, 2 interesting points stand out. Firstly, the entire 13L covering of Friday, have been rolled over to December. So, in effect only 17L contracts covered during this entire fall. Even more surprisingly, there has not been much OI addition on any of the fall days - so it is all pointing to long liquidation rather than short addition. 
7. Another important factor to be considered is, DII have been buying equities during the week. Add, the high equity selling yesterday by FII indicate that we are closer to the bottom. ( I go with premise that equity cycle is a delayed FnO cycle - and high activity in equities generally indicate culmination of that particular cycle.) RM's MO at -95 also suggests that we are closer to a bottom - time wise, if not price wise. :)
8. The FII SAR we are following is at 4850. I said in my last notes as well that, the significant lowering of SAR is a cause of concern as, it indicates profit booking from the institutions. From the highs 5256, it reached 4850 - 400 points down in a week's time. The only solace is, it did not fall down much yesterday, indicating a pause.
9. Where do we go from here? I distinctly see 2 possibilities. Firstly, there is smart money involved in the longs between 5100 and 5200. They are hedged so far - they are booking their hedges now, and they will get a  decent exit with a rally towards the zone. Secondly, the longs in the zone this week are like a deer in front of the headlights and they did not react at all. Panic will strike them next week, when they find no hope of retrace. In which case, what we saw is only a teaser and the real movie is in the expiry week. Take your call on one of these possibilities and it should reward handsomely, if you are on the right side. 
10. You can find the entire data sheet here.