Pre Market Report, November 7, 2017 | Stocks and Commodities

November 7, 2017
Time: 8.15 am

Pre Market Report:

1. US markets closed marginally higher.
2. Asian markets are mostly positive.
3. SGX Nifty is trading around 10520.
4. Yesterday I thought Nifty future will face resistance at 10500 but that was crossed intraday comfortbly.
5. Hong Kong Index recovered more than 450 points from the intraday low and that was a big recovery.
6. Today it is up by about 300 points. So swing of more than 1000 points since yesterday morning.
7. So our markets also shot up from intraday low, Nifty shot up nearly 90 points from intraday low.
8. Today HDFC Life issue opens and the response must be good.
9. Ahead of this IPO both HDFC and HDFC Bank were strong yesterday and that supported the markets at the lower levels.
10. But still HDFC Bank is lower than last month high.
11. I am long in HDFC Bank around 1800, long in two lots.
12. Highest open interest among Puts is at 10000.
13. Since this is a 5 week series, people are cautious.
14. ICICI Bank, HDFC Bank ADRs are up by over 1% and Tata Motors up by 3.5%.
15. Overall markets are in bullish mode with FIIs turning net buyers after a long time.
16. So evry fall of more than 50 points in Nifty is an opportunity to sell put options.
17. Yesterday when Nifty fell, I sold Nifty 1000PE and below.
18. Now I have Nifty November 10100PE buy and 10000PE and below PE sell.
19. December 10200PE buy and 10000PE and below sell.
20. Bank Nifty 25500PE buy and 25000, 24500, 24000, 23500, 23000PE sell.
21. In addition I sold ONGC 217.50CE and SBI 375CE. Both strikes are the highest strikes traded in those counters. SBI 375CE sold at Rs 3, giving Rs 9000 per lot, even at the highest strike. This Friday SBI results will be out.
22. I sold HDFC Bank 1780PE and 1760PE. I expect HDFC Bank not to fall due to HDFC Life IPO.
23. Yesterday I sold more options as India VIX was up by 7% without any big news flow.
24. Some people said, 'Paradise Paper Leak' and some others said 'Saudi Arabia commotion' as the reason for rise in India VIX.
25. Whatever is the reason, it is time for option sellers to bebnefit out of rise in VIX.
26. Yesterday Coal India was down, yet Call option premiums shot up. I sold Coal India 320CE at Rs 1.50. Again this Saturday results will be out.
27. After the results, implied volatility will go down.
28. November being 5 week series, I am keeping enough buffer Cash to capture opportunities like this.
29. Deploying the buffer Cash in weekly options to make some money.
30. I sold Bank Nifty 25000PE, 24900, 24800 and 24500PE and 26300CE in weekly options.
31. Now Nifty future crossed 10500, next resitance will be only at 10580.
32. Support may come at 10450 today. For positional trade 10420 shold be the stop loss.