Pre Market Report, August 20, 2019 | Stocks and Commodities

August 20, 2019
Time: 7.40 am

Pre Market Report:

1. Yesterday could not write "Pre Market Report" as I was travelling from Bali to Singapore.
2. Yesterday markets opened higher and traded well above 11100.
3. Suddenly in the afternoon selling came and Nifty fell more than 120 points.
4. We opened higher due to Global cues and DII support.
5. But on Friday FIIs had sold for more than Rs 1300 crores.
6. There was no positive news from stimulus front over the weekend.
7. That triggered profit booking once Nifty future touched 11150.
8. Kotak Bank, HDFC Bank came under good selling pressure, Bank Nifty lost more than 350 points from intraday high.
9. Yesterday was the best day for bulls to touch at least 200DMA, but they failed miserably.
10. We are struggling while Global cues are so good.
11. What will happen if Global cues turn bad?
12. US markets closed higher.
13. But Asian markets are mixed.
14. Now German is talking (not only talking) about Fiscal stimulus.
15. Yesterday FIIs have sold for about Rs 300 crores while DIIs have bought for similar amount.
16. NBFCs and HFC will be in focus today s RBI has done away with Debenture Redemption Reserves.
17. HDFC has been moving violently in this series.
18. DTC recommendations submitted to FM but not made public.
19. As usual medias are telling whatever they like in the name of "sources"
20. Here and there some news comes from Govt as well as RBI regarding the Economy.
21. So we can expect some stimulus announcement in the next few days.
22. But if markets are not happy with the terms of the stimulus, that is when the real selling will come.
23. So if there is any gap up on stimulus news, that will be the time to lighten the long positions.
24. Today as long as 11000 is not broken, we can expect some recovery.
25. There are two reasons for expectation of recovery.
26. One, FII selling of Rs 300 crore plus is not a big selling.
27. Second, short sellers will like to book profits on any fall as Stimulus announcement may come anytime.
28. In the last few days, the tone is changing.
29. Yesterday FM said corporate tax will be cut to 25% gradually and will support the "wealth creators"
30. One week before she said, "We will cut corporate tax to 25% (only) as and when GST collections are robust.
31. Yesterday RBI said it will not allow any NBFC to collapse.
32. Yesterday they have done away with Debenture Redemption Reserve.
33. These are indications that Stimulus is not far away from here.
34. One can consider the strategy: +1X11000CE and -1X11100CE.
35. Maximum loss will be Rs 3750 and that will be when Nifty expires below 11000.
36. Maximum profit will also be Rs 3750 and that will happen when Nifty expires above 11100.
37. If there is any stimulus during this week or during weekend, next week markets may move higher.
38. Anyway the target of 11100 is not far away from here, the target may be achieved even without stimulus, if Global cues are good.
39. You can sell some CEs in this weekly expiry if you want to reduce the cost of buying 11000CE.
40. Drone attack in Saudi making Oil prices jittery.
41. UP Govt has increased taxes on Petrol and Diesel.
42. OMCs are not going to recover anytime soon.
43. Right now markets are consolidating.
44. Bulls will win only above 200DMA around 11180.
45. Today Nifty future may take support around 11000.
46. Resistance will be around yesterday's high.