India’s benchmark Nifty Futures has settled at a critical juncture after trading in a range of 50 points throughout the day. Although today’s closing at 11678 has tilted the index in favor of the buyers, long positions in the OTM Call options failed to generate returns intraday. The ratio which was created on the 10th of July by the institutions has achieved 98% returns in today’s session. This brings us to the big question, “Will the institutional traders book profit tomorrow?”
What are the odds of profit booking tomorrow?
Two crucial aspects might force the institutions to wrap up their ratios tomorrow. First, if the market triggers a big a gap-up or gap- down tomorrow. Second, if the implied volatility in the option strikes fails to cushion the ratio in the event of gap-up or gap-down move.
Can It Trigger A Swing Move?
Nifty might trigger a swing, if the ratios are wrapped up, else not. Tomorrow’s range high and range low will act as crucial pivot points for the index to trigger the big swings. If the index trades above the range high or drops below the range low, it might witness swift fluctuations of 100 points or beyond.