Market Setup

A special day is up for a special start! Today NIFTY might see a new All Time High, and what a day to hit an All time high! US ended on a high with S&P 500 closing above 2500 and Asia is on fire!! NIFTY will open well above 10,100 mark probably above 10,120 too which is a resistance! If NIFTY opens and stays above 10,120 then we are heading towards 10,150 and in the process cross 10,137 which is the All time high till now!
I suggested buying at 10,050 levels when NIFTY dipped there on Thursday and Friday. If you had taken a position you will see it reaching your target of 10,150 giving you a meaningful 100 point profit. This is not a market to short and any short will lead to short circuiting of your finances! The NIFTY put call ratio is at 1.52 vs 1.54 seen on Thursday. This drop is primarily due to shorting of FIIs on Nifty call especially 10,200 and 10,150 calls and am worried what will happen if those call premiums shoot up because of NIFTY rally.
FIIs were seen shorting NIFTY futures also to upto 1100 Cr and the overall FII sell number in Friday was Whopping 2050 Cr. But today the scene could be reverse. Today is the time to exit the long position once NIFTY touches 10,150 and wait for the next opportunity!

On the macro front

The trade deficit numbers for August comes on Friday evening and the Trade deficit widens to 11.6 billion dollars compared to 7.7 billion seen at same period last year. Exports are up only 10.3% compared to last year while imports for the same period is up 21%!! Most of this is attributed to GST disruptions where exporters are worried and importers are importing items which do not required to be imported fearing higher GST!!
All this could stabilize soon. But for numbers Exports stand at 23.8 billion this august vs 21.6 billion last year and imports stand at 35.4 billion vs 29.3 billion seen last August!! Govt need to watch this carefully!