Category Archives: Market Setup

Trade Setup/Market Setup

Visit this column every morning on weekdays to know how Indian markets will fare and read the predictions on market behavior. Nifty, Sensex and Bank Nifty and many more important news will be discussed in a short 200-300 word post. Predictions are all based on my own learning and perceptions. The information posted should not be used by others for wrong reasons.

Happy Investing!

#SriramSpeaks

Market setup 14th July

Market setup

We are now just 108 points away from 10,000. Its said that the last mile is always tough. TCS disappoints in Q1 and Infosys might come up with the Q1 by 9.45am today and that will impact the market. A new all time high opening might happen to NIFTY but sustaining it and remaining there will be a challenge. Will there be a profit taking in the afternoon? Or Should you take any profit before that 10,000?
If profit is taking then the market will test 9850 levels. It’s a weekend and its unpredictable weekend this time.
Infosys is the only company coming with its Q1 result and we will know what happens by 10am today. There is a tough competition between Infy and TCS and with TCS missing the mark, infosys if it delivers will have a edge.
Fuel prices in important cities in India
City Petrol Diesel
Delhi 63.89(63.91) 54.66(54.70)
Mumbai 73.23(73.25) 58.19(58.22)
Kolkota 67.37(67.38) 57.41(57.44)
Chennai 66.34(66.36) 57.63(57.67)
Bangalore 65.06(65.07) 54.80(54.83)
Hyderabad 67.87(67.89) 59.54(59.57)
Petrol prices fell just 1-2 paise and diesel by 3-4 paise.

Market Update 13th July

Market Update

It’s time for all time high again! After a pause for a day, NIFTY is all set to shatter the records and open at an all time high. A opening above 9850 is guaranteed. Positive global cues and strong domestic macros are going to push the NIFTY to higher levels. Today we could see 9900 and we are now at the touching distance to 10,000. Remember I predicted that any close above 9800 will mean a major push to the market. If you have entered the market on July 7th when it was at 9600 levels, you are already sitting on 2.5% profit in 4 trading sessions and today the point is whether the close happens above the opening level or not. Watch it closely. The last 1 hour will be dominated by the weekly expiry of Bank Nifty.

News

On the macro front, CPI inflation comes at a multi year low of 1.54%. Food inflation is at -2.12%. This is staggering because the food prices are actually falling. Last year same time it was at 7.8%. To put it in simple words, if a kilo of tur dal was 100 rupees a 7.8% inflation means it goes to 107.80 rupees and a inflation of -2.12% means it drops to 97.88 rupees. Shame on RBI that they allowed us to get to this dismal level before they react. Services inflation which RBI saying is worrying also drops to 3.8% vs 4.8% seen same month last year. Attached to CPI is IIP figures that comes at 1.7% vs 3.1% seen one month before. That is a bad sign and a sign of a slowing economy. Unless RBI wakes up on 2nd August and cuts rates, they would ruin the economy with their own hands with the “play safe” approach they are taking.

Results

On the results front, TCS is coming up with the Q1 result and everyone will be looking forward to it as it will clearly tell you, how IT sector is going to go in 2018 fiscal.

Fuel prices in important cities today, 13th July

City Petrol Diesel
Delhi 63.91(63.93) 54.70(54.74)
Mumbai 73.25(73.27) 58.22(58.27)
Kolkota 67.38(67.40) 57.44(57.49)
Chennai 66.36(66.38) 57.67(57.72)
Bangalore 65.07(65.10) 54.83(54.88)
Hyderabad 67.89(67.91) 59.57(59.62)
There was a slight fall in petrol price by 2-3 paise and Diesel by 5 paise from yesterday to today.

Market update 12th July

Market update

2 days we made all time highs on NIFTY and will we see it repeat on 3rd day also? Its 50-50. Yesterday’s close below 9800, as I indicated in my update yesterday shows this market is not in a big hurry to conquer 10,000. 3 days it gave nearly 170 points but hereon things might pause a bit. After a big rally there should be a pause and today might be that day. Trump Jr’s emails and not so great start to Q1 results have dampened the sentiment a bit. Another flat day is expected today and 9830 will continue to be a resistance and again the close above or below 9800 determines the strength of the market in near term.
The put-call ratio is at 1.37 which is a multi month high and serious call buying seems to have started at 10,000. On the results front Indus Ind bank delivered on Profit and NII front but NPA looks bit worrying. profits grew 27% and came at 836.5 Cr. NII which is the income you earn by interests you get on lending stood at 1774 Cr. NPAs however went upto 609 Cr or 1.09% in Q1 vs 0.93% seen in Q4 of FY17. South Indian bank as usual was a disappointment. The stock fell almost 4% and now trading at 27.70. No important results scheduled for today.
The important macro news today is the CPI and IIP results scheduled at 5.30pm today. CPI for June is expected to come at 1.6% vs 2.2% seen in May. IIP for the month of May is expected to come at 1.7% vs 3.1% seen in April this year.

Given is the Petrol prices in important cities today, 12th July

City Petrol Diesel
Delhi 63.93(63.93) 54.74(54.74)
Mumbai 73.27(73.27) 58.27(58.27)
Kolkota 67.40(67.40) 57.49(57.49)
Chennai 66.38(66.38) 57.72(57.72)
Bangalore 65.10(65.10) 54.88(54.88)
Hyderabad 67.91(67.91) 59.62(59.62)

Prices remain unchanged today.

Market Setup 11th July

Market setup

 Asian markets are in green and that will add fuel to India. Technical problems have impacted almost 4 hours of trading yesterday and today is another day. It is a start of the results season with two banks coming up with their results, Indus Ind and South Indian banks. NIFTY today is at an all time high and the journey towards 10,000 is well on its way. Today the start will be positive close to 9800 and today we will see another all time high for Nifty and with negative fundamentals like terror attacks yesterday might keep NIFTY under check. 9830 is the likely to be the resistance for the day and 9750 might be tested. If the close happens below 9800 then there can be a correction in the near term. I see a flat day today with a positive bias.
Q1 Results scheduled today
1. Amtek Auto 31.35 (-0.32%)
2. IndusInd bank 1559.80 (+2.35%)
3. South Indian bank 28.80 (+2.31%)
Both Indus Ind and South Indian bank closed 2% higher before the results. What happens today in the results needs to be seen. In other news Airtel is offering its customers the facility of rolling over their left over data into next data cycle. This will be a huge plus as lot of customers don’t use up all their data. Airtel is also planning to extend this to prepaid customers subsequently. Air India as a cost saving initiative has turned totally vegetarian. The economy class customers will get only vegetarian meal. Non veg will be served to only in International flights and in business class of domestic flights. Air India is expected to save 5 Cr per year through this initiative.

Petrol Prices in Important cities today, 11th July

City Petrol Diesel
Delhi 63.93(63.83) 54.74(54.55)
Mumbai 73.27(75.04) 58.27(59.93)
Kolkota 67.40(66.73) 57.49(56.85)
Chennai 66.38(66.25) 57.72(57.44)
Bangalore 65.10(65.00) 54.88(55.48)
Hyderabad 67.91(67.81) 59.62(59.41)

Like NIFTY yesterday the petrol and diesel prices behaved erratic today in different cities. Mumbai saw a huge drop in prices, Kolkata saw a huge rise and other cities some up and down movements.

Market setup July 10th

Market setup

Global cues are positive. US jobs data at record high, asian markets are high but there is one fundamental that will bother NIFTY today. That is SEBI regulation on p-notes in derivatives market. According to a circular issued by SEBI on Friday, Foreign Portfolio Investors cannot take a naked position in derivatives market. That means no long or short position in either in futures or in options market. Every position they wish to take in derivative market should be a hedge position for the main position they have in the cash market. Needless to say that its applicable only to the stocks.
40,000 Crore is the value of FPIs in p-notes. All that is going to get affected now. The existing positions have to be wound up in the coming expiry months. That will put pressure on stocks where there are long positions in futures and options like banking, FMCG and Auto stocks. Those positions have to be closed so there will be lot of selling happening there for all the naked positions. And for sectors like Pharma, Telecom, IT sectors where there are more short positions, there will be short covering in closing those positions. That means today market will make unpredictable moves with stocks reacting. This move also will bring down the volumes in the derivatives market as naked positions are not allowed. Good or bad, only time will tell.
For today NIFTY will open flat to positive with opening around 9680. Are we going to see the all time high of 9709 broken today? Looks likely. Will it close at a new all time high? We will have to wait and see on a day where some confusing Indian fundamentals encounter a good global fundamentals.

Fuel prices today, 10th July in important cities

City Petrol Diesel
Delhi 63.83(63.65) 54.55(54.32)
Mumbai 75.4(74.86) 59.93(59.15)
Kolkota 66.73(66.58) 56.85(56.69)
Chennai 66.25(66.05) 57.44(57.19)
Bangalore 65.00(64.81) 55.48(55.24)
Hyderabad 67.81(67.61) 59.41(59.16)

 

Petrol prices became costlier by 20 paise and diesel by upto 25 paise from yesterday to today owing to rise in fuel prices. Just last Monday petrol was 67.01 in Hyderabad and today it’s 67.81. That’s a growth of 80 paise in a week’s time!

Market Update July 7th

Trade setup

A double top was made yesterday when NIFTY reached 9700 very close to its 5th June high of 9709 and closed at 9674.55 which is very very close to June 5th close of 9675.10. Today global factors are looking mildly negative and that coupled with this double top will pull NIFTY down a bit today. The start will be below 9650 and what needs to be seen is how far it will down the NIFTY. My interest would be to look at protecting 9600 and will yesterday’s high will be tested ever or not.
In other news, Shriram group is merging with IDFC. Parent company Shriram capital, which manages insurance and other core finance functions of Shriram will merge with parent IDFC while Shriram city union and Shriram transport finance will merge with IDFC bank. This deal is worked out to be 10 billion dollars. Piramel enterprises will be in the news as it has a substantial stake in Shriram group
City Petrol Diesel
Delhi 63.33(63.19) 53.82(53.61)
Mumbai 74.54(74.41) 59.15(58.93)
Kolkota 66.33(66.23) 55.90(55.74)
Chennai 65.72(65.58) 56.65(56.43)
Bangalore 64.49(64.35) 54.73(54.52)
Hyderabad 67.27(67.13) 58.61(58.39)
Figures shown in brackets are previous day’s prices. Petrol wen up by 12 to 15 paise and diesel by 12 to 16 paise.

Market setup July 6th

Market Setup

No doubt that market is going up and now NIFTY is slowly inching to the upper end of the range of 9670. One thing is clear, if you have taken the long positions yesterday, its time to move on. There will be a resistance again at 9670 area but what needs to be seen is whether NIFTY will cross or not.
Bank NIFTY is up for its weekly expiry and premium eating will happen at 23300 and 23400 put and call levels. 23300 put is at 30 rupees and 23400 call is at 60 rupees. so if both are shorted Bank NIFTY should stay between 22270 and 23460 band and any expiry between this range means the entire premium from both put and call is yours.
City Petrol Diesel
Delhi 63.19(63.08) 53.61(53.44)
Mumbai 74.41(74.10) 58.93(58.76)
Kolkota 66.23(66.14) 55.90(55.74)
Chennai 65.58(65.46) 56.43(56.25)
Bangalore 64.35(64.23) 54.52(54.35)
Hyderabad 67.13(67.01) 58.39(58.21)

 

Petrol prices went up by 10 to 12 paise from yesterday. Prices in the brackets are yesterday’s prices.

Market setup July 5th

Market Setup

We are back in the range again, the range that lasted for almost a month in the previous expiry. Yesterday’s move shows clearly that NIFTY is no mood to cross 9670 and looks like its going to spend some time there. The global factors are not positive and that may weigh on NIFTY today. The biggest point is will 9600 be broken after the open?
Lot of put selling was happening yesterday at 9600 and that has a premium of 90 rupees now. So, the floor for the market seems to be fixed at 9520 levels. So, any dip towards that should be used as an opportunity for taking long positions and if you don’t have a long position till now, get one today itself!
City Petrol Diesel
Delhi 63.08(63.08) 53.44(53.44)
Mumbai 74.1(74.30) 58.76(58.76)
Kolkota 66.14(66.14) 55.74(55.74)
Chennai 65.46(65.46) 56.25(56.25)
Bangalore 64.23(64.23) 54.35(54.35)
Hyderabad 67.01(67.01) 58.21(58.21)
Figures in brackets are the yesterday’s prices.

Market setup 4th July

Trade Setup

One good day changed it all. Markets gave a big thumps up to GST with a 1% gain on NIFTY. All GST sensitive stocks celebrated big time. With this the base and the roof of NIFTY shifted upwards. Surprising factor is maximum open interest is at 9800 now indicating this series has a potential to go there. 9800 has a premium of 30 rupees now and many traders are making early moves by buying 9600 call and selling 9800 call. On the put side put writing is shifting from 9500 to 9600 indicating a shift in the base towards 9530 levels now.
With GST in and the false breakdown taken out in just 2 days, are we in for a break out in 9670 levels very soon? Any dip should be bought now and keep a target of 9800-9830. This level will come very soon and ITC continues to roar. Ashok leyland, Eicher are also on roar and will continue to do so. Am waiting for the banks also to join the rally. ICICI and Kotak could start the resurgence of banks now.

Fuel Prices in India’s Major Cities

City  Petrol  Diesel
Delhi  63.08  53.44
Mumbai  74.30  58.76
Kolkata  66.14  55.74
Chennai  65.46  56.25
Bangalore 64.23  54.38
Hyderabad 67.01  58.21