August 23, 2019
Time: 8 am
Pre Market Report:
Time: 8 am
Pre Market Report:
- Yesterday was the worst day, market cap wiped out by more than 2 lakh crores.
- Thanks to CEA comment, "Profit is for private and loss is for public?"
- He conveniently forgot whenever there is profit in Crude oil, Govt takes the profit by increasing duty but whenever there is a loss, it is passed on to common man consumer.
- Power Minister and Railway Minister are talking but Finance Minister is busy travelling to small cities like Mysuru to understand the "Problems"
- The message from Govt is loud and clear, there will be no meaningful stimulus.
- Even if there is some small stimulus, it will be surely too late, too little.
- None of the strategies working except shorting on intraday recovery.
- Swing low was broken, breaking all technicals.
- Today morning all Asian markets are higher but SGX Nifty is in Red.
- People who are just selling Call options making good money.
- I have Nifty 11000 short straddle in October and December.
- While December straddle still ended with few rupees profit, October straddle has given some loss.
- Today evening Fed chairman's comment will decide the direction of US markets next week.
- But going by the history, he is likely to disappoint the markets.
- Over the weekend, if there is no news about any stimulus, which is unlikely, our markets will come under more selling pressure next week.
- Due to significant fall in last one months, even a small selling will bring the market down as everyone is afraid of buying.
- Until yesterday Nifty 11000PE had highest open interest and that has changed in one day.
- Bank Nifty fell more than 700 points intraday, HDFC Bank and Kotak Bank which were holding the day before, came under severe selling pressure.
- Unless LIC enters the market and buy aggressively, market will not recover.
- However there may be some sharp upside move towards the end of the day as traders will like to square off their short trades ahead of week end holidays.
- In case, if there is any announcement by Govt or Fed, markets may open gap up on Monday.
- If Nifty does not close above 10800, I will look to add some short positions.
- Taking short positions at this point of time is very risky.
- However, we can always sell Call options.
- Yesterday I sold 10800CE in September and 11000CE in October both around Rs 230.
- The reason, now 11000 will be the first strong resistance and 11200 which is above 200DMA will be the second strong resistance.
- In case if Nifty crosses 10800, then will sell 10800PE is September and will convert that into "short straddle", same thing for 11000CE.
- If the markets continue to be weak, then just enjoy the profit.
- Now watch for 10800, 11000, 11200 for the next few weeks.
- Markets may tarde sideways in the first half and likely to make a sharp move in the last one hour, hope it is not on the downside.
- It will be good if everyone keep quiet, in case if anybody speaks on behalf of Govt, then that sharp move can come on the downside.