Pre Market Report, October 12, 2018 | Stocks and Commodities

October 12, 2018
Time: 8.40 am

Pre Market Report:

1. US markets closed lower.
2. DOW fell 1300 points in two days.
3. But right now, US futures are higher.
4. Many Asian markets are in Green after a brutal sell off.
5. Taiwan index fell more than 5% yesterday.
6. Yesterday between 7.30 pm to 9 pm, SGX Nifty fell from 10350 to 10240.
7. But now SGX Nifty is trading 60, 70 points higher.
8. Markets are consolidating with huge volatility.
9. Earlier I have suggested selling both Nifty 10400CE and PE.
10. Also suggested selling both Bank Nifty 25000CE and PE.
11. Both are giving good profit.
12. FIIs are selling heavily, yesterday they have sold for about 3000 crores.
13. October series is the worst series for FII selling.
14. We need to see how TCS reacts to results.
15. I think results are not bad, that counter may see some short covering.
16. I have sold TCS 2400CE at Rs 10, I will still make money as IV will collapse in that counter.
17. Yesterday there were huge losses in many of my clients account.
18. Luckily I minimised losses by intra day fire fighting.
19. Still 3 to 5% of the losses were there in each account.
20. Yesterday Nifty took support around 10150 as I expected.
21. Nifty may be trading between 10150 and 10450 for the next few days.
22. Markets will make significant move only when this range is breached.
23. So one can sell Nifty 10000PE if there is any intraday dip and can sell 10600CE if there is any intraday bounce.
24. Today IIP and CPI Inflation data will be out in the evening.
25. Markets will be interesting next week due to corporate results.
26. Right strategy now is to choose bearish stocks, if there is any intraday bounce, short in future and sell ATM Put option.
27. Choose bullish stocks, intraday dip, buy future and sell ATM Call option.
28. For me, ICICI Bank is bullish, Maruti is bearish.
29. When Maruti came to 7000, I shorted and sold 7000PE.
30. When ICICI Bank came to 310, I bought future and sold 310CE.
31. Since I am not very bullish, I am planning to Buy Nifty 10500CE and then selling 10600, 10650CE, 10700, 10800CE. 
32. I am not that bearish also, so I am planning to buy Nifty 10000PE and sell 9900PE, 9850PE, 9800PE, 9700PE.
33. The idea is to make money by time decay.
34. Banking stocks are out performing.
35. So one can devise a strategy in Bank Nifty also.
36. Nifty future may trade between 10250 and 10400.