🌅 FII/DII Morning Report — Mon, 6 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 (03-Jul-2026)

FII: Buy ₹13,337 Cr | Sell ₹11,982 Cr | Net +₹1,355 Cr ▲

DII: Buy ₹18,676 Cr | Sell ₹20,630 Cr | Net -₹1,954 Cr ▼

Combined Net: -₹599 Cr

Participant Long Short Net Direction vs FII

--------------------------------------------------------------

FII 29,772 280,539 -250,767 Short — ★

DII 76,163 11,589 +64,574 Long Opposed

Client 239,868 67,171 +172,697 Long Opposed

Pro 44,875 31,379 +13,496 Long Opposed

📊 INSTRUMENT WISE FUTURES SIGNAL (03-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

----------------------------------------------------------------------------------------------------------------------

INDEX +6,133 -5,475 +0.29 Moderate Bullish Short Covering —

NIFTY +8,532 -5,550 +0.55 Strong Bullish Short Covering 24,270.85 +95.15 (+0.39%)

BANKNIFTY -2,145 -175 -0.44 Strong Bearish Long Unwinding 57,938.50 -93.15 (-0.16%)

FINNIFTY -4 +4 -0.15 Moderate Bearish Short Buildup 26,875.05 +12.65 (+0.05%)

MIDCPNIFTY -253 +243 -0.52 Strong Bearish Short Buildup 14,545.90 -27.40 (-0.19%)

NIFTYNXT50 +3 +3 +0.16 Moderate Bullish Long Buildup 72,268.95 -149.60 (-0.21%)

STOCK +12,780 +47,446 +0.02 Neutral Long Buildup —

👥 PARTICIPANT OI (03-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 -2,50,767 +1.00 Strong Bullish

DII +64,574 -1.00 Strong Bearish

Client +1,72,697 -1.00 Strong Bearish

Pro +13,496 -0.09 Weak Bearish

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 +5,47,349 +0.27 Moderate Bullish

DII -40,34,815 +0.22 Moderate Bullish

Client +29,77,493 -0.15 Weak Bearish

Pro +5,09,973 -0.97 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 -2,33,473 -0.10 +4,77,175 -0.39 -0.24 Moderate Bearish

DII +3,255 -0.12 +25,041 -1.00 -0.56 Strong Bearish

Client +89,025 +0.02 -6,12,821 +0.06 +0.04 Neutral

Pro +1,41,192 -0.06 +1,10,605 -0.00 -0.03 Neutral

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 -80,446 -0.31 +65,145 -0.27 -0.29 Moderate Bearish

DII -2,01,216 -0.99 +28,521 +0.63 -0.36 Strong Bearish

Client +5,73,046 +0.23 -2,67,197 +0.20 +0.21 Moderate Bullish

Pro -2,91,384 +0.02 +1,73,531 -0.09 -0.08 Weak Bearish

S1 Futures OFR : +1 (Bullish)

S2 Options OFR : -1 (Bearish)

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

Total : 0/3 → Neutral

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 bought ₹1,355 Cr in cash on 03-Jul while executing Short Covering in index futures with Moderate Bullish FSR of +0.29 on Nifty, but this bullish surface masks a deeply conflicted positioning where index options Combined OFR turned Moderate Bearish at -0.24 and stock futures net of +12,780 contracts with Neutral FSR reveals conviction is concentrated in individual stocks, not macro direction. The conviction score of 0/3 is neutral because S1 (Futures OFR) reads +1 bullish while S2 (Options OFR) reads -1 bearish, creating a hedging signature where FII is closing index shorts defensively while maintaining bearish options protection—this is portfolio hedging, not directional conviction. DII sold ₹1,954 Cr on the same day, breaking their four-day accumulation streak from the prior week, and their index options Combined OFR collapsed to Strong Bearish at -0.56, signaling domestic institutions sensed FII's defensive structure and withdrew support rather than sustaining the floor they had been providing.

The prior week established FII distributed ₹4,004 Cr cumulatively while building index shorts that peaked mid-week before unwinding, and 03-Jul continued that unwinding pattern with Short Covering activity in Nifty futures, confirming FII is systematically closing the bearish index positioning they had accumulated. However the closing is mechanical rather than conviction-driven—options remain bearish, stock futures remain long, and DII's Friday reversal into selling breaks the domestic institutional support that had sustained the prior week's accumulation, meaning the market enters this session without a structural floor. The pattern across both weeks is consistent: FII rotated from macro bearish to stock bullish with index shorts as portfolio protection, not directional conviction, and when DII's tactical accumulation ended on Friday, the only remaining institutional positioning is FII's defensive hedged structure and Client's unhedged opposition.

FII carries forward -250,767 index futures net shorts being progressively closed through Short Covering while maintaining +547,349 stock futures net longs, establishing a hedged long-equity-short-index structure that is fundamentally defensive rather than bullish—they are protecting existing stock positions, not attacking the market. DII's ₹12,634 Cr week total from the prior week is being progressively hedged with both index and stock options turning bearish by Friday, and their Friday selling of ₹1,954 Cr breaks the accumulation pattern and signals they sense FII's defensive positioning and are unwilling to provide additional support going forward. Weekly expiry on 07-Jul will force rapid position resolution across all participants, and with FII concentrated in defensive stock conviction while DII withdraws support and Client opposition unhedged, the institutional environment today is one of position unwinding rather than conviction—FII is protecting rather than attacking, and the structural floor has cracked.

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.