Markets and News
A big rally in US last night after a disappointment day before. It now looks see-saw for US markets with one day up and one day down trend continuing. The big point is S&P 500 is above its 200dma which might be a good news for the World markets. The Asia seems to have gone on the track of its own, is totally flat today. The trade war between US and China is still on and it will continue to have its impact. Crude for now has settled around 67 dollars per barrel.
Domestic Cues
On domestic front, the fundamentals seems to be slowly settling down. The insolvency code is in news today and Govt is thinking of revamping some of its provisions. That keeps the banks and NBFC stocks in focus today. The auto sector continues to give positive results. The two day MPC meeting for deciding the first monetary policy for FY’19 will start today. Inflation is very much in control and that might put the MPC on softening its stand on growth and inflation. Nobody is expecting a rate cut now and all that is of interest is the tone of the policy and scope of any cut in this year. On the listing news Mishra dhatu nigam and ICICI securities will list today, am not bullish on both the companies. Both might disappoint.
Derivatives Action
On the derivatives front, there has been equal amounts of long and short positions traded in the market yesterday. The market was net short in the morning but things started to change post noon and many long positions seems to have come up. Even the options market also remained in the same trend with equal number of puts and calls have come into play. The nifty put call ratio remained almost flat at 1.43 vs 1.42 seen at the beginning of the day. The 10000 put and the 9950 put seems to be most active on the put side while 10400 and 10300 call are emerging as the two of the most favourite calls to short.
What is the Nifty and bank nifty call for the day?
A flat Asia and a flat SGX means we will open flat today at 10250 zone which is a strong resistance. I will be very keenly watching how this level will be taken out and how much time will it take to do that. If 10250 is taken out in the first hour then we are on our way of meeting 10300 target. If you get there, exit take profit and step aside for the day and see for a dip to re-enter. Wait for my twitter calls for that. On the bank nifty side, The positions taken at 24350 levels will give you its target of 24650 today and even if it is not reached hold on to your long positions and wait for tomorrow and it will surely reach its target. If the target is reached book profits and wait for the next move.