Pre Market Report, December 10, 2020 | Stocks and Commodities

 December 10, 2020

Time: 8 am

Pre Market Report:

1. US markets closed lower as there was some problem over Stimulus negotiations.
2. Asian markets are following US markets.
3. But right now they are off their lows.
4. People need a reason to book profits after such a stellar bull run.
5. Yesterday, we made another All Time High.
6. Reliance, HDFC Bank, Kotak Bank helped the markets.
7. remember Reliance and HDFC Bank have 25% weightage in Nifty and DFC Bank and Kotak Bank have about 50% weightage in Bank Nifty.
8. So yesterday it was purely Index Heavy play.
9. Broder markets did not do so well.
10. Today in the second weekly expiry in this series.
11. Due to huge surge in the markets, 13400, 13500 Call options unwinding took place.
12. Huge OI added at 13650.
13. Among the Puts, 13500 saw huge OI of nealy 30 lakhs.
14. Nifty 13450, 13400 PEs also saw huge Open Interest.
15. Nifty is likely open between 13450 and 13500.
16. In case, if markets fall further, these Option writers will have to run for cover, fuelling further fall.
17. Usually Wednesday trades are high voltile.
18. But yesterday there was not much volatility.
19. So the Volatilty may have been reserved for today's trade.
20. Need to watch Reliance, HDFC Bank and Kotak Bank closely for the cues.
21. FIIs have bought for about Rs 3.5K crores yesterday.
22. DIIs have sold for about 2.5K crores.
23. That is the usual game now a days.
24. Any fall of more than 100 points in Nifty, it is time to sell Put options at 13000 and below.
25. Nifty will find huge support between 13000 and 13100.
26. Moreover India VIX is high and premiums are decent.
27. As markets have run up, too fast and too furious, profit booking can come at any time.
28. Better to be cautious on long side. However, downside may be limited to 3 to 4%.
29. Nifty may find good support at 13400.
30. Resistance will be around 13600.