Pre Market Report, November 14, 2017 | Stocks and Commodities

November 14, 2017
Time: 8.35 am

Pre Market Report:

1. US markets closed slightly positive after a roller coaster ride.
2. Yesterday morning Dow futures was positive, then towards the evening turned negative and then again positive in the night.
3. But Asian markets are mostly negative dragged by Australia.
4. China's IIP data came lower than expected and China and Hong Kong are also down. Remember these two markets were up yesterday against the Global trend.
5. Coming back to our market, there was a sharp selling in the last one hour.
6. At the end of the day both FIIs and DIIs were net sellers.
7. So it is time to be cautious.
8. July expiry was around 10150, after nearly 4 months, we are somewhere there only.
9. It is a very consolidation.
10. Since 9700-10200 range was broken last month, 10200 should be a great support.
11. Let us whether that holds today or not.
12. If 10200 is broken in Cash, then next support will at 10100 which is 50 DMA.
13. Markets will be reacting to CPI inflation numbers today. Around noon, WPI inflation number will be out.
14. So Bank Nifty will be in focus today.
15. Decline in Nifty was lead by Reliance and HDFC both fell around 8 to 9%.
16. Highest open interest among Puts is at 10200 and among Calls is at 10500.
17. So markets may trade between these two numbers for the next two weeks.
18. But if 10200 is broken decisively, then next highest open interest is at 10000. So markets may trade between 10000 and 10100 in that case.
19. But probability of that is happening is low right now.
20. Since FIIs are hugely short, they may square off their shorts at lower levels triggering short covering rally here and there.
21. Yesterday both Nifty and Bank Nifty traded with a significant premium to their corresponding underlying.
22. Even when Bank Nifty fell 150 points, Bank Nifty Put options did not shoot up.
23. This muted response in Put option prices along with Significant premium in futures may be interpreted as "bottom is somewhere near"
24. Markets may be weak in the first half and there may be some action in the second half.
25. A good correction for long term investors. I bought Reliance, Kotak Bank, Auro Pharma in Cash market. All stocks are bought after 10% correction. Sold Call options for hedging.
26. I also bought HDFC Bank around 1800, though there was no 10% correction.
27. Nifty future should take support at 10200. For the last many days my predictions have been going wrong. Let us see what happens today.
28. Resistance will be at 10320.