Nifty Market Outlook – June 3, 2025 🔍
By Option Matrix India
The Nifty closed at 24,716.6 today after a day of range-bound consolidation with a mildly bullish bias. While the index showed resilience, undercurrents in the derivatives and cash market signal critical cues for tomorrow’s trade.
Cash Market Snapshot:
- DII Activity: Net Buy of ₹5313.76 Cr – strong domestic support.
- FII Activity: Net Sell of ₹2589.47 Cr – cautious stance persists.
Domestic institutional investors (DIIs) continued their buying spree, indicating confidence in the market's medium-term trajectory. However, the persistent selling by FIIs reflects global risk aversion or hedging ahead of key events.
Derivatives Data Breakdown:
Client Segment:
-
Aggressively long across all fronts:
- Index Futures: Net long 996 (Long > Short)
- Strong positions in Option Index Calls (204k long) and Puts (331k short)
- Indicates a bullish retail/institutional view, expecting a continued uptrend or stable momentum.
DII Segment:
- Zero participation in options and index futures.
- Heavy net short in Index Futures (-5372), possibly indicating cash-based hedging or arbitrage.
- Their activity reinforces that their bullish cash positions are hedged using derivatives.
FII Segment:
-
Mixed positioning:
- Net long in Index Futures (505) and Options Calls (Net ~128k Long)
- Some Puts shorted, suggesting moderate bullish hedging rather than outright bearish bets.
- Overall, FIIs are likely hedging their cash outflows rather than aggressively shorting the market.
PRO Segment (Proprietary Traders):
- Strongly net short in Index Futures (-1493) but heavily long in Options, especially Calls and Puts.
- Likely indicating a volatility play or neutral strategy (e.g., straddles or strangles).
- Could be anticipating a range breakout with no clear directional bias yet.
Technical + Derivative Cues Combined:
| Metric | Observation |
|---|---|
| Client Positioning | Bullish bias; supportive of upward continuation. |
| FII Positioning | Hedged; mildly bullish, not aggressively shorting. |
| DII Behavior | Strong cash buy, futures hedging – directional bet is long. |
| Pro Activity | Range strategy; possible volatility ahead. |
| Options Data | Puts being shorted across categories suggests support zones building. |
Prediction for Tomorrow (June 3, 2025):
Considering the data:
- Support Level: 24,500 (Put writing visible)
- Resistance Zone: 24,850–24,900 (may see call buildup)
- Expected Move: Sideways to Positive bias
- Range: 24,500 – 24,850
View: “Buy on Dips” strategy favored. With DIIs pumping liquidity and retail optimism evident, short-term trend remains upward biased, despite FII caution. Watch for any global cues or event risk that might change sentiment abruptly.
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