🌅 FII/DII Morning Report — Thu, 4 Jun, 2026

FSR (Flow Strength Ratio): Range -1 to +1

Measures how one-sided FII's futures buying vs selling was — not the absolute size but the relative aggression. Two sessions with identical net contracts can have very different FSR values depending on total activity.

Positive = FII bought more contracts than sold (bullish flow)

Negative = FII sold more contracts than bought (bearish flow)

Strength: >=0.30 Strong | >=0.15 Moderate | >=0.05 Weak | <0.05 Neutral

Reliability: Nifty most reliable → BankNifty → MidCap Nifty → FinNifty and NiftyNext50 least reliable. Stock futures is a broad signal only — individual stock breakdown not available.

OFR (OI Flow Ratio): Range -1 to +1

Measures how a participant's accumulated long and short positions shifted compared to the previous session — not how much they traded today but how their total positioning changed.

Positive = participant adding longs or closing shorts (bullish positioning shift)

Negative = participant adding shorts or closing longs (bearish positioning shift)

Strength: >=0.30 Strong | >=0.15 Moderate | >=0.05 Weak | <0.05 Neutral

Caution: Futures OFR is especially misleading for FII because portfolio hedging inflates their futures positions. For DII, Client, and Pro, futures OFR is more likely directional but still less reliable than options Combined OFR. Always prefer options Combined OFR over futures OFR when they conflict.

Combined OFR: Range -1 to +1

Merges Call OFR and Put OFR into one unified options signal per participant. Shown for options rows only — futures rows show dash because futures have only one OFR value.

When Call and Put OFR agree — high confidence directional signal.

When Call and Put OFR conflict — dominant side wins but with reduced conviction. The conflict itself is meaningful.

Put OFR sign is automatically flipped so positive always means bullish — consistent with calls and futures.

Strength: >=0.30 Strong | >=0.15 Moderate | >=0.05 Weak | <0.05 Neutral

Signals:

Long Buildup = OI up + Net Buy → fresh longs added, bullish

Short Buildup = OI up + Net Sell → fresh shorts added, bearish

Short Covering = OI down + Net Buy → shorts being closed, bullish

Long Unwinding = OI down + Net Sell → longs being closed, bearish

Conviction Score (S1+S2+S3): Range -3 to +3

Three independent FII signals combined — futures positioning shift, options positioning shift, and actual cash deployment.

S1 = Index Futures OFR → >+0.05 bullish | <-0.05 bearish | else neutral

S2 = Index Options Combined OFR → same thresholds

S3 = FII Cash Net vs dynamic threshold (75th pctile of past 1yr flows)

+3 Strong Bullish | +2 Moderate Bullish | +1 Weak Bullish | 0 Neutral

-1 Weak Bearish | -2 Moderate Bearish | -3 Strong Bearish

Hedging Warning: fires when S1=S2 but S3 contradicts — FII using derivatives to hedge equity portfolio, not a directional bet. Do not treat conviction score as directional when active.

Battle Table:

Positive net = net long (bullish) | Negative net = net short (bearish)

Neutral = less than 2% directional bias

Aligned = same direction as FII | Opposed = opposite to FII

★ = Dominant participant (largest absolute net position)

When Client Opposed to FII → historically FII tends to be correct at inflection points.

💰 CASH MARKET (03-Jun-2026)

FII: Buy ₹17,054 Cr | Sell ₹22,670 Cr | Net -₹5,617 Cr ▼

DII: Buy ₹17,530 Cr | Sell ₹11,789 Cr | Net +₹5,741 Cr ▲

Combined Net: +₹124 Cr

Participant Long Short Net Direction vs FII

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FII 25,951 285,204 -259,253 Short — ★

DII 66,156 29,722 +36,434 Long Opposed

Client 277,894 81,809 +196,085 Long Opposed

Pro 62,276 35,542 +26,734 Long Opposed

📊 INSTRUMENT WISE FUTURES SIGNAL (03-Jun-2026)

Note: Net Contracts = Today's buy contracts - today's sell contracts. Positive = FII bought more than sold. Negative = FII sold more than bought.

OI Change = Change in total open interest vs previous day. Positive = new contracts added (OI increased). Negative = contracts squared off (OI reduced).

Instrument Net Contracts OI Change FSR Strength Signal Price & Change

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INDEX -29,157 +31,983 -0.32 Strong Bearish Short Buildup —

NIFTY -29,283 +30,451 -0.40 Strong Bearish Short Buildup 23,405.60 -77.95 (-0.33%)

BANKNIFTY +433 +1,667 +0.03 Neutral Long Buildup 54,185.95 +471.30 (+0.88%)

FINNIFTY -21 -1 -0.24 Moderate Bearish Long Unwinding 24,955.70 +94.45 (+0.38%)

MIDCPNIFTY -274 -146 -0.25 Moderate Bearish Long Unwinding 14,149.05 -91.40 (-0.64%)

NIFTYNXT50 -12 +12 -0.19 Moderate Bearish Short Buildup 69,856.40 -259.40 (-0.37%)

STOCK -43,997 -37,015 -0.06 Weak Bearish Long Unwinding —

👥 PARTICIPANT OI (03-Jun-2026)

Note: All participant OI data is combined across all expiries — NSE F&O data only. Not expiry specific. Current month contracts are the most liquid — majority of activity happens there — data can be used accordingly.

Conviction Score is available for FII only. For DII, Client, and Pro — use options Combined OFR as their primary directional signal. Futures OFR is especially misleading for FII due to portfolio hedging — less so for DII, Client, and Pro who are more likely directional.

Note: Net OI = Long OI - Short OI. This is NOT daily buy/sell — it is the total accumulated position. Positive = longs are more than shorts. Negative = shorts are more than longs.

FII negative Net OI does not always mean FII is heavily bearish — FII may use index futures to hedge their equity portfolio. However if options Combined OFR also turns bearish simultaneously, it is genuine directional conviction, not hedging. Always cross-check with options Combined OFR and FII Conviction Score before concluding.

Participant Net OI OFR Strength

FII -2,59,253 -0.91 Strong Bearish

DII +36,434 +1.00 Strong Bullish

Client +1,96,085 +1.00 Strong Bullish

Pro +26,734 +0.93 Strong Bullish

Note: Net OI = Long OI - Short OI. This is NOT daily buy/sell — it is the total accumulated position. Positive = longs are more than shorts. Negative = shorts are more than longs.

FII negative Net OI does not always mean FII is heavily bearish — FII may use stock futures to hedge individual stock positions. However if options Combined OFR also turns bearish simultaneously, it is genuine directional conviction. Always cross-check with options Combined OFR and FII Conviction Score before concluding.

Participant Net OI OFR Strength

FII +6,90,820 -1.00 Strong Bearish

DII -42,14,946 -0.58 Strong Bearish

Client +30,04,497 +1.00 Strong Bullish

Pro +5,19,629 +0.34 Strong Bullish

Note: Call Net OI = Call Long - Call Short. Positive = net long calls (bullish). Negative = net short calls (bearish).

Put Net OI = Put Long - Put Short. Positive = net long puts (bearish). Negative = net short puts (bullish).

Always prefer Combined OFR for options — it gives the complete directional picture.

Participant Call Net OI Call OFR Put Net OI Put OFR Combined OFR Combined Strength

FII -2,51,345 +0.16 +5,38,004 -0.25 -0.09 Weak Bearish

DII +7,726 +1.00 +23,860 +0.00 +0.50 Strong Bullish

Client +1,62,899 -0.18 -7,60,497 +0.04 -0.14 Weak Bearish

Pro +80,722 +0.24 +1,98,634 +0.02 +0.13 Weak Bullish

Note: Call Net OI = Call Long - Call Short. Positive = net long calls (bullish). Negative = net short calls (bearish).

Put Net OI = Put Long - Put Short. Positive = net long puts (bearish). Negative = net short puts (bullish).

Always prefer Combined OFR for options — it gives the complete directional picture.

Participant Call Net OI Call OFR Put Net OI Put OFR Combined OFR Combined Strength

FII -94,084 -0.32 +69,341 -0.69 -0.51 Strong Bearish

DII -2,42,859 -1.00 +22,743 +1.00 +0.00 Neutral

Client +7,68,244 +0.60 -3,70,433 +0.81 +0.71 Strong Bullish

Pro -4,31,301 -0.48 +2,78,349 -0.24 -0.36 Strong Bearish

S1 Futures OFR : -1 (Bearish)

S2 Options OFR : -1 (Bearish)

S3 Cash Market : -1 (Threshold: ₹3,800 Cr)

Total : -3/3 → Strong Bearish

Hedging Warning : Not Active

Note: Conviction Score is FII only. For DII, Client, and Pro — use options Combined OFR as their primary directional signal. Futures OFR is especially misleading for FII due to portfolio hedging — for other participants it is more likely directional but options Combined OFR remains the stronger signal.

FII extended a three-day selling streak to ₹17,891 Cr cumulative outflow with conviction shifting from moderate to extreme — conviction score reached -3/3 Strong Bearish across all three independent signals for the first time this week, with index futures showing Strong Bearish FSR of -0.32 on Nifty and Short Buildup activity indicating aggressive new short positioning rather than passive unwinding. DII absorbed ₹20,439 Cr cumulative inflow across the same three days, establishing a genuine domestic institutional floor beneath foreign selling pressure. Stock futures revealed the critical distinction: FII held net long of ₹690,820 contracts while aggressively shorting index futures, confirming FII is using index hedges to protect equity portfolio exposure rather than expressing a bearish directional view on India itself. However stock options Combined OFR turned -0.51 Strong Bearish, indicating FII is simultaneously reducing conviction in individual stock positions, suggesting the hedging is defensive rather than opportunistic. All three other participants — DII, Client, Pro — positioned long against FII's index shorts, the historically correct side at inflection points.

The week shows a sustained institutional rotation where foreign money is exiting the index systematically across four consecutive sessions with accelerating magnitude while domestic capital steps in to absorb every rupee, creating a structural floor beneath the selling. FII's positioning split between index shorts and stock longs indicates they are not abandoning India but rotating from broad index exposure into stock-specific conviction, a classic pre-volatility positioning that typically precedes sector or stock-level moves rather than broad market reversals. Conviction is building, not fading — this is deliberate positioning, not panic distribution.

FII enters today with extreme bearish conviction on the index (-3/3 score) but maintained long equity exposure through stock futures, while DII has established a structural bid beneath foreign selling with ₹20,439 Cr cumulative inflows. The institutional environment is split between foreign hedging and domestic accumulation, creating a market where index volatility is elevated but underlying stock conviction remains intact. This is the positioning of an institution expecting near-term turbulence but retaining confidence in long-term equity selection.

All metrics are for informational and analytical purposes only. Signals reflect past positioning and do not guarantee future market direction. This report reflects prior day data — it is not live data, as exchanges do not provide FII/DII data in real time. Past data does not reflect future directional activity of FII/DII. Do your own research before making any trading or investment decisions. This is not financial advice. Always consult a SEBI registered financial advisor before taking any decision.