Pre Market Report, July 15, 2016 | Stocks and Commodities

 July 15, 2016
Time: 8.50 am

Pre Market Report:

1. US markets closed at all time high once again.
2. Asian markets are mostly trading firm.
3. Though yesterday BoE did not cut the rates, they said they will announce stimulus along with rate cut in few weeks time.
4. So August will also be an interesting month with both India and England said to cut the rates.
5. I am surprised to see that Bank Nifty August expiry trading above 20000.
6. That is the kind of bullishness in Bank Nifty.
7. In fact yesterday morning, I mentioned that Nifty 8900 Call premium was up by 20% when markets actually closed in Red and open interest more than doubled in just one trading session on Wednesday.
8. Yesterday I bought about 31,000 quantity of 8900 Call at an average price below Rs 5.
9. Yesterday itself, it hit a high of 10.20 and closed at Rs 10.
10. I may close half the position (or keep stop loss for half the positions) to take back my money.
11. So the cost for remaining positions is zero and I can run those positions.
12. Earlier, I bought 8500 Call and sold 8700 Call as hedge.
13. I have already mentioned that BoE, though did not cut rates, gave dovish comments.
14. TCS has come out with good results.
15. US markets shot up on back of JP Margan's good results.
16. Now the focus will be on Infy results.
17. Infy results can make Nifty to move 50 points on either side.
18. Only problem is that they are likely to announce the results at 9.15 am.
19. So you won't even know the trend in pre market.
20. Yet SGX Nifty is trading about 30 points higher.
21. Without knowing Infy results, it is difficult to predict a range for Nifty.
22. Personally I am bullish on Infy.
23. I have gone long in futures in one account, bought 1200 Call 10 lots and sold 2 Calls each at 1220, 1240, 1260, 1280 and 1300.
24. Another account I just followed the method I have given yesterday, bought 5 lots of 1200 Call, sold 5 lots of 1240 Call and 1280 Call.
25. In another account, I sold 1200 Put and 1220 Call.
26. In another account, I just sold 1100 Put and 1300 Call.
27. So I have applied various strategies.
28. But all with positive bias or neutral bias.
29. My view is that the stock has already corrected by 6 to 8% in the last 3 months when Nifty was up by nearly 10%.
30. So even if results are bad, the downside may be limited.
31. By 9.30 am, we will know how these positions perform.
32. Since I play with lot of money, even Infy falls, I will sell additional Calls and I will manage somehow.
33. Last time, I was long in Infy, but it fell, yet I came out with Rs 32,000 profit just by selling additional Calls.
34. So what is more important is not your view, how you manage when your view go wrong.
35. If the view is correct, sit back and enjoy, if the view go wrong, go and manage by pumping in more money.
36. That is my strategy.
37. So for a day, people may forget Banking stocks and will focus on IT stocks.