Pre Market Report, October 16, 2017 | Stocks and Commodities

October 16, 2017
Time: 8.20 am

Pre Market Report:

1. FIIs have sold for Rs 1700 crores on Friday.
2. Yet on Friday night, SGX Nifty hit 10250.
3. Now SGX Nifty is trading around 10250.
4. US markets closed at all time high again on Friday.
5. Asian markets are mostly trading at decade high.
6. When most people were bearish about Indian stock markets, suddenly in the last one week all bad news turned good nes.
7. (i) Inlation was low (ii) IIP was high (iii) Exports up 26% (iv) Trade deficiet is down (v) Auto sales in top gear (vi) Rupee stabilising and appreciating a bit (vii) Direct Tax collection up (viii) Record Mutual Fund inflow despite weak markets, etc
8. There is an increase of 66% inflow to mutual fund from North East which could be black money converted to white using liberal tax laws for North east.
9. Nifty shot up 25% in the first 6 to 7 months of this year and then consolidated for nearly 4 months between 9700 and 10200.
10. Now the market is breakinh out and it is logical to assume that the next leg of the rally will be powerful.
11. So any dip will be a buying opportunity now.
12. I plan to buy 10000PE in December and then sell double the quantity of 9800, 9700, 9600, 9500, 9400, 9300, 9200PE in December.
13. My breakeven will be below 9700 which should a very strong support.
14. I will be waiting some some intraday dip to create this strategy, if there is no intraday dip, then at 3 pm I will create this strategy.
15. This is a low risk low reward strategy.
16. I have already done this strategy with 9700PE buy and 9400, 9300, 9200, 9100, 9000PE sell.
17. I will be selling some call option to hedge if RSI crosses 70 and then fall below 70. Until then no Call option.
18. I already sold huge quantity of Bank Nifty 22500PE in November, now I am planning to sell 23000PE in November. But only when there is intraday dip.
19. HDFC Bank shot up by more tha 4% in US.
20. Highest open interest among Bank Nifty calls is at 25000. So it may pause there for few days.
21. Today WPI infltion data is due. So Bank Nifty will be in focus again.
22. In monthly options, I sold 10000PE and 9900PE. Highest open interest amomg PE is at 10000.
23. I am looking to add more puts during dips.
24. Reliance will be in focus after its rsults.
25. Nifty future may trade between 10180 and 10280.