February Outlook | Stocks and Commodities

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January 31, 2014
Time: 11.30 am

February Outlook:

1. Long and volatile month of January is over.
2. January was a 5 week month, FII flow in the first month, RBI policy and Fed policy and Q3 results by leading companies, all these made January a volatile month.
3. But February is a short month.
4. There are only 19 trading sessions.
5. Also no RBI policy and no Fed meeting. Not many big companies Q3 results.
6. So February is expected to be sideways market with Nifty not moving more than 200-250 points either way.
7. Despite so many big events, Volatility still stays very low.
8. So option premiums also very low.
9. Usual data like PMI data, IIP data, Inflation data, US employment report etc will make the market move in the first two weeks.
10. Last two weeks will be boring as there will be no budget this time only vote on account.
11. Pre election rally, if anything, may set in in the early March if global cues continue to be good.

Recommendation:

1. Sell Nifty 5700 Put option and 6400 Call option.
2. Sell Nifty March expiry 5500 Put option and 6700 Call option.
3. Sell Bank Nifty 9000 Put option and 11500 Call option.
4. Sell Auro Pharma 400 Put option and 530 Call option.
5. Sell L&T 900 Put option and 1100 Call option.