🌅 FII/DII Morning Report — Fri, 3 Jul, 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 (02-Jul-2026)

FII: Buy ₹14,018 Cr | Sell ₹14,330 Cr | Net -₹312 Cr ▼

DII: Buy ₹17,392 Cr | Sell ₹15,607 Cr | Net +₹1,784 Cr ▲

Combined Net: +₹1,473 Cr

Participant Long Short Net Direction vs FII

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FII 29,443 286,343 -256,900 Short — ★

DII 76,185 11,589 +64,596 Long Opposed

Client 243,441 65,455 +177,986 Long Opposed

Pro 40,808 26,490 +14,318 Long Opposed

📊 INSTRUMENT WISE FUTURES SIGNAL (02-Jul-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 +3,159 -9,225 +0.13 Weak Bullish Short Covering —

NIFTY +4,661 -9,239 +0.23 Moderate Bullish Short Covering 24,175.70 +169.85 (+0.71%)

BANKNIFTY -1,260 -514 -0.36 Strong Bearish Long Unwinding 58,031.65 -1.40 (-0.00%)

FINNIFTY +8 +6 +0.17 Moderate Bullish Long Buildup 26,862.40 +64.65 (+0.24%)

MIDCPNIFTY -244 +516 -0.22 Moderate Bearish Short Buildup 14,573.30 +37.20 (+0.26%)

NIFTYNXT50 -6 +6 -0.43 Strong Bearish Short Buildup 72,418.55 +317.90 (+0.44%)

STOCK +37,720 +28,334 +0.06 Weak Bullish Long Buildup —

👥 PARTICIPANT OI (02-Jul-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 -2,56,900 +0.34 Strong Bullish

DII +64,596 +1.00 Strong Bullish

Client +1,77,986 -1.00 Strong Bearish

Pro +14,318 +1.00 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 +5,34,569 +1.00 Strong Bullish

DII -40,39,474 -0.25 Moderate Bearish

Client +29,78,967 -1.00 Strong Bearish

Pro +5,25,938 -1.00 Strong Bearish

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 -2,24,900 +1.00 +4,42,042 +1.00 +1.00 Strong Bullish

DII +3,420 -1.00 +24,656 +1.00 +0.00 Neutral

Client +59,093 -0.27 -5,77,233 -0.12 -0.19 Moderate Bearish

Pro +1,62,387 +1.00 +1,10,535 +0.30 +0.65 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 -63,962 +0.03 +53,654 -0.19 -0.17 Moderate Bearish

DII -1,60,737 -1.00 +29,984 +0.13 -0.87 Strong Bearish

Client +5,19,311 -0.28 -2,45,491 -0.05 -0.17 Moderate Bearish

Pro -2,94,612 +0.45 +1,61,853 +0.14 +0.30 Moderate Bullish

S1 Futures OFR : +1 (Bullish)

S2 Options OFR : +1 (Bullish)

S3 Cash Market : 0 (Threshold: ₹3,800 Cr)

Total : +2/3 → Moderate Bullish

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 reversed from three consecutive days of selling into net buying of ₹312 Cr in cash while closing index shorts through Short Covering (+3,159 net contracts, Weak Bullish FSR +0.13) and simultaneously building stock longs through Long Buildup (+37,720 net contracts, Weak Bullish FSR +0.06). Index futures OFR and index options Combined OFR both turned Strong Bullish at +0.34 and +1.00 respectively, but this derivatives alignment combined with near-flat cash creates the classic hedging signature—FII is unwinding bearish index protection while committing to stock selection, not expressing genuine directional conviction. Conviction score of +2 Moderate Bullish reflects the mixed picture: two derivative signals bullish, cash signal neutral. DII maintained their four-day accumulation at ₹14,587 Cr with Strong Bullish index futures OFR at +1.00, but stock options Combined OFR remained Moderate Bearish at -0.25, confirming they are buying but hedging stock-specific risk rather than holding unhedged conviction.

FII's week shows a complete arc from Monday's Moderate Bearish conviction (-2/3) through Wednesday's peak bearish positioning with -260,059 index shorts and genuine directional conviction, to Thursday's reversal into stock long buildup with index shorts being unwound. This is not a reversal of conviction but a repositioning: FII moved from macro bearish (index shorts) to stock bullish (stock longs), using index derivatives to hedge out prior short exposure rather than panic covering. DII absorbed all four days of FII selling with consistent cash accumulation, but their options positioning progressively turned defensive—from neutral on Monday to Strong Bearish in stock options by Thursday—signaling they sense FII's stock conviction and are protecting rather than confident in sustained support. The week's dominant pattern is FII's rotation from index-bearish to stock-bullish positioning, with DII providing consistent floor support but increasingly hedged.

FII carries +534,569 stock futures net longs built in a single session with Strong Bullish OFR, their largest conviction signal of the week, while -256,900 index futures net shorts are being systematically closed through Short Covering rather than panic unwinding. This positioning structure—short index, long stocks—is fundamentally different from Monday's contested environment and represents FII's deliberate bet on stock selection over macro direction. DII's ₹14,587 Cr four-day accumulation remains intact but their intensifying stock options hedging signals they sense FII's stock conviction and are protecting rather than confident. Weekly expiry on Tuesday will force position resolution, and with FII now concentrated in stock longs while DII hedges their accumulated cash positions, the market structure depends entirely on whether FII's stock conviction sustains or whether this is merely tactical unwinding ahead of expiry.

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.