Pre Market Report, March 17, 2020 | Stocks and Commodities

March 17, 2020
Time: 8.15 am

Pre Market Report:

1. Absolute mayhem, huge volatility, extreme fear, do not know what other way we can express the current state of markets.
2. On Friday Nifty dived to 8300 from previous day close of 9600, then shot up to 10100, then fell to 9700, then closed at 10000. Yesterday it fell to 9100, fell to 8800 in Singapore.
3. Today morning SGX Nifty shot up to 9400 and then now trading around 9250.
4. US markets are even worst.
5. Dow fell third highest, after 1987 crash and 1929 crash.
6. Gold, Silver, Crude all fell.
7. Three interesting thins.
8. One, South Korea Central Bank cut rates after markets close yesterday, following the tradition of other countries, South Korea markets fell.
9. Two, Dow followed the tradition of one day up and one day down of more than 1000 points yesterday also.
10. Third, Pre Market lower circuit and upper circuit on alternate days also followed. But now upper circuit hit but after that now trading slightly lower.
11. What I observed in 2008, any bounce followed by any announcement or measures by Central Banks or Govts, will be short lived.
12. There must be some selling exhaustion, short sellers should feel that markets may not fall more.
13. That is when markets can stabilise.
14. Right now VIX is close to 2008 peak level.
15. That has to come down. Yesterday Bank Nifty fell 1500 points at one point of time but 29000CE was trading higher.
16. This kind of volatility was not seen even in 2008.
17. While writing this blog, Asian markets are giving up their gains.
18. SGX Nifty down 300, then up 300, now absolutely flat.
19. It is time for traders to keep away from markets.
20. Or can simply sell CEs on every bounce, that too far OTM.
21. Bank Nifty 27000CE was trading around Rs 100 in weekly options.
22. Making money in intraday also seems to be very difficult as premiums are not goin down.
23. Though there is no point in looking at any data points in a highly volatile markets, somehow I feel that 8500 to 9000 is the area where the support will come for Nifty.
24. Yesterday sold 10200, 10300, 10400, 10500CE in weekly Nifty and 26000CE, 27000CE in weekly Bank Nifty.
25. Already sitting with some profits, since VIX is very high, doing only weekly options.
26. Theta decay will be very fast in weekly options. Premiums are not falling proportionally in monthly options.