Pre Market Report, January 25, 2018 | Stocks and Commodities

January 25, 2018
Time: 8.25 am

Pre Market Report:

1. US markets ended mixed.
2. Asian markets are mostly higher.
3. Dollar index is lower.
4. Brent crude crossed US$70.
5. So Auto stocks will be under pressure.
6. Auto stocks have not been doing well for the last few weeks due to Crude prices.
7. But this is the right time to invest in Auto stocks.
8. Maruti has fallen nearly 7% from the peak.
9. Today Maruti will be in focus ahead of its results.
10. SGX Nifty after hitting 11120, now trading almost flat.
11. PSU recapitalisation news has already been factored in the prices, many PSU banks have already shot up by more than 10% in the last few days.
12. India VIX shot up by more than 30% in the last three days.
13. Bank Nifty Call options are trading at unrealistic levels, for today expiry, even 1000 point away, premiums are more than Rs 10.
14. But this kind of markets throw a great opportunity.
15. Yesterday one client brought in Rs 90 lakhs, I sold Nifty 10900, 10800, 10700PE, 11300CE and in Bank Nifty I sold 26500, 26400, 26300, 26200PE and 28000, 28100, 28200,28300, 28400, 28500CE. Yet collected Rs 1.4 lakhs as premium. The entire premium is likely to be the profit today.
16. It is a return of 1.5% in just one day, that too with the kind of such a low risk.
17. So high volatility is actually good for option sellers.
18. Despite such a high volatility, Nifty and Bank Nifty closed almost flat. All the option prices fell in January.
19. Today last half an hour of trade is going to be very volatile.
20. I plan to exit most of my positions before 2.30 pm.
21. I closed all my positions in February.
22. I am planning to reenter only next week.
23. Today Nifty is likely to expire between 11080 and 11120. But intraday volatility may be high.