Pre Market Report, September 28, 2017 | Stocks and Commodities

September 28, 2017
Time: 8.45 am

Pre Market Report:

1. US markets closed at all time high again but we are in a bad shape.
2. We fel bady yesterday after opening higher.
3. It seems that some people are aware of surgical strike before the news came to public domain.
4. We are in a panic situation.
5. RSI is near 30, PCR is at 1.
6. Expiry related issues will also come into play.
7. But I feel that the sell off was due to F&O positions and that will end today.
8. In the past, many times when this kind of situation came, markets closed at the lowest point of the series and then markets recoverd the following day.
9. We can expect markets to trade sideways with negative bias or slightly positive bias until afternoon.
10. Towards the end of the day, there may be some sharp short covering rally.
11. The probability is only 50%. If there is no short covering towards the end of the day, then the recovery will happen only tomorrow.
12. First let us discuss positives: (a) FII selling has come down, they have sold for leass than 1000 crores for the first time in the last one week, after selling for more than 1000 crore everyday.
13. (b) DII buying outpaced FII selling by 1000 crore and that was not the case in the last few days. Either they bought equivalent to FII selling or less.
14. (c) As mentoned above, we are nearing oversold levels as RSI is near 30.
15. (d) PCR ratio 1 means there is even Put and Call, so further shorting by Put option sellers to avoid the loss in Put option is very less. Moreover shorting to safeguard the Put option on the expiry day is very risky.
16. (e) The sell of is not global in nature. It is India specific, so it will stabilise at some point. So far big corrections were global in nature.
17. There are some negatives also. (a) FII selling of about Rs 40000 crores in the last two months is a severe one. Worst selling after 2008 crash.
18. (b) Crude is going up, Rupee is going down, both are not good.
19. (c) GST refund of Rs 65000 crore is stuck and that is affecting Exporters, which in turn may affect the economy.
20. (d) For today, Global markets are not supporting, many Asian markets are down. Anyway we did not follow Asian markets in the last few days.
21. So there are some positives and some negatives. Which one is going to dominate the market is a million dollar question.
22. Nifty made bottom at 9685 in August fall Nifty should take support there.
23. Interesting thing is that SGX Nifty hit a low of 9686 yesterday night.
24. So expect sideways markets with sharp move on either side towards the end of the day.