Pre Market Report, July 17, 2017 | Stocks and Commodities

July 17, 2017
Time: 8.35 am

Pre Market Report:

1. US markets closed higher on Friday. 
2. Asian markets are mostly higher.
3. China is down, classical example of 'Buy on Romour and Sell on News'
4. China GDP data came at 6.9% which is better than expected figure of 6.8%.
5. SGX Nifty is trading above 9940, about 40 points higher.
6. In fact, on Friday, Nifty was down but Nifty future was up, due to premium expansion.
7. Today the premium is expected to fall, that means Nifty Spot may rise more than 40 points at open.
8. In different forums, I see people are generally in short, nobody is long.
9. Huge amount of Put buying by innocent investors made PCR to cross 1.5.
10. At least short sellers can hedge their positions by selling Put option, rollover the shorts, they can average the price by selling again at higher levels.
11. But Put option buyes are the people who will lose heavily if markets do not fall.
12. Put option buyers are working against time as well as markets.
13. SEBI must bring a rule that all option buyers should pass an examination on Option Greeks.
14. In the next few days, Price Value (Delta), Time Value (Theta) and Volatility Value (Vega) all will be working against them.
15. Reliance and Kotak Bank will be in focus due to results this week.
16. If there is no short covering by P Notes, then markets may consolidate with positive bias for the next few days.
17. Then Kotak Bank result and Reliance result will decide the direction in the last two days of the week.
18. Reliance is looking too bullish.
19. I will sell more Put options if Nifty futures come to the level of 9920.
20. I have sold Put options aggressively already.
21. All my Put positions are in profit and hence can maintain stop loss.
22. I will be safe as long as there is no big gap down in Nifty.
23. To hedge the positions, I sold 10100 Call on Friday but now regret it.
24. I am planing to sell Put options in August or September from 9400 to 9000.
25. I have huge amount of December Nifty 9000 Put option.
26. This is a multi year bull run, be on the long side.
27. At the same time, do not chase the market, buy on dips.
28. Even on Thursday, I bought Nifty future at 9966 (Nifty future hit a low of 9958 on that day, I bought at 9966 as the previous day low was 9957, I kept that as stop loss), now I will reaping a benefit of about 80 points.
29. So the risk was only Rs 10, but reward is very high.
30. Nifty future may trade between 9920 and 9980.