 |
| P R Sundar, Aditya Trading Solutions |
Time: 7 am
Pre Market Report:
- US markets rose yesterday. Nasdaq closed marginally lower because of apple.
- FIIs bought in cash market and sold in F&O market.
- Our markets are overbought in the short term
- Despite such a big rally and overbought condition, our markets are very volatile and huge swings both sides happened twice yesterday.
- This two way swing is the sign that the market is either topping out or bottoming out. Now logically it should be topping out.
- Volatility is still more than 30.
- For the first time, Call premiums are higher than Put premium.
- This shows that general market opinion is more bullish. (This is where smart people will book profits)
- Today Market suport is at 5880 and resistance is at 5980.
- Nifty may touch 6000 if the market overshoots, but huge selling is expected once Nifty crosses 6000.
- Markets are not likely to fall significantly from here as sector rotation is expected. This is evident from the fact that yesterday despite flat closing, all PSU banks have gone up significantly and mid caps and small caps outperformed Nifty and Sensex by huge margin. So sell 5500 or 5400 or 5300 Putoption depending upon your risk ability. Due to the Fed tapering news, vix is trading above 30. Once that news is out, VIX will fall and hence the premium.
- As an hedge also sell 6400 or 6500 Call option. Surprised to see Nifty 6500 Call option trading at more than Rs 5.
- For the fist time, PSU banks are showing stability. This is a beaten down sector, these stocks may not fall much even if markets fall. So comfortably can sell Bank Nifty 8500 Put option.
Comments
Post a Comment