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

December 7, 2017
Time: 8.50 am

Pre Market Report:

1. US markets ended mixed.
2. Asian markets are also mixed.
3. SGX Nifty hit a low of 10042 yesterday night.
4. But Now trading almost flat around 10075.
5. Everyday my prediction of lower level is going wrong.
6. Nifty is forming lower lows and lower highs.
7. This means, anyone who is going short, next day he is in profit.
8. At least, on Monday and Tuesday, some intraday recovery came in Bank Nifty.
9. Yesterday only selling came.
10. FIIs have been selling aggressively in Cash market.
11. As for as I remember, this is the longest selling spree by FIIs, even longer than 2008 bear market.
12. So the next few days may see the last leg of selling by FIIs.
13. FIIs may sell more aggressively as they will become inactive in the last two weeks of December.
14. But everything is not negative.
15. FIIs in F&O were net buyers in stock futures.
16. So that shows some shorts being covered at the lower levels.
17. Yesterday it was PSU Banks along with HDFC Bank and ICICI Bank that dragged the Bank Nifty.
18. HDFC Bank is up by about half a percent in US, so we need to see how this stock performs, remember HDFC Bank contributes 33% to Bank Nifty.
19. Other private sector banks did not do that badly.
20. Hong Kong markets are consolidating with huge volatility.
21. The same may happen here.
22. Bank Nifty weekly expiry will add to the volatility.
23. As long as 10050 is not broken we can hope for some stability.
24. If Nifty crosses 10100 and trades firmly above this level, then we can expect some short covering towards the end of the day.
25. Today Bank Nifty movement between 3.00 pm and 3.300 pm, will be an interesting thing to watch.
26. 20, 50, 100DMAs are broken, then next big support is at 9700 which is double bottom last time as well as 200DMA.
27. So any intraday recovery, selling 10500CE is good.
28. Or going short and selling at the money put is also a good idea.
29. But we need enough buffer to adjust the positions.
30. Yesterday I sold December 2018 expiry 8500PE for Rs 88.
31. I am planning to sell 8500PE and 12000CE, as I am expecting Nifty to trade in this range for next one year.
32. Nifty future will find resistance around 10150. Support may come at yesterday's low of 10050.