Pre Market Report, April 15, 2020 | Stocks and Commodities

April 15, 2020
Time: 8 am

Pre Market Report:

1. We were closed yesterday.
2. US markets closed in Red day before yesterday and SGX Nifty tested 8900.
3. But yesterday morning US futures were in Green, SGX Nifty shot up.
4. PM has announced 19 day lock down extension.
5. But SGX Nifty continued to trade higher and hit 9300.
6. Most people on the street were of the opinion that markets will fall when lock down extension announced.
7. Many people were speculating Nifty will be testing 7500 by April end.
8. But as of now SGX Nifty does not indicate that.
9. In fact Europe and US markets look optimistic as the Corona Virus peaked out.
10. At the same time, the big question is, will this rally sustain?
11. I do not think so.
12. Nifty has already shot up more than 1500 points from the recent low.
13. Now 38.2% Fibonacci retracement falls between 9200 and 9300.
14. Yesterday I posted a YouTube video of my positions.
15. You can see there I sold huge amount of Put options and Call options at 9400 and 9500 in weekly.
16. The reason is that I am expecting huge resistance between 9200 and 9300.
17. We are actually entering into the resistance zone.
18. On Monday both FIIs and DIIs were net sellers for more than Rs 1000 crores in Cash market.
19. WIPRO, TCS, HDFC Bank, ACC will be declaring results in the next few days.
20. Remember 3 months extension was given to companies to declare quarterly results.
21. So most companies will not declare results.
22. Today Nifty will gap up about 200 points and Bank Nifty about 500 points.
23. But we have to be cautious about gap up, I expect at least one selling wave towards 9120.
24. One good news is that Crude fell 10% over night and now stabilising.
25. In weekly, highest open interest among Puts is at 8500.
26. Highest open interest among Calls is at 9500.
27. I plan to sell 8800PE in weekly, not at the opening, may after half an hour.
28. Since Bank Nifty has under performed for last few days, it may out perform.
29. We have to see how Bajaj Twins perform today.
30. Bajaj Finance fell more than 10% on Monday.
31. I sold 2300PE at Rs 220. It is a very high risk trade.
32. On Monday Nifty future traded at 30 points premium vs 30 point discount the day before.
33. That is why the damage at futures level was not bad.
34. But in Cash market, Nifty fell more than 100 points and Bank Nifty more than 400 points.
35. So surely today morning, there will be short covering.
36. I am planning to sell 10500CE or 11000CE if Nifty future approaches 9300, in May series.
37. Now S&P 500 VIX is below 40, around 37, it is time for our VIX also to go down.
38. With the lock down extension uncertainty is over, we can expect significant drop in India VIX today.
39. If gap up is sustained for half an hour or more, VIX will start coming down.
40. Nifty future may trade between 9000 and 9300.