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Market Trade Setup 11th January

Its Friday and the 2nd week of this 5-week series is coming to an end. The cues from the global set up are looking good with Boeing coming up with good numbers that pushed the Dow Jones. Yesterday also Dow Jones has clocked a 100 plus point growth. Added to this is Jerome Powell’s statement that there won’t be any more rate hikes in the near term. The main reason for this is the slowdown in the global economies while the US would continue to grow stronger. This is the statement which Trump will like so with a consensus between Fed and US Govt, US markets are celebrating. Asian markets today have been in a mild positive zone today with all the markets posting an uptrend of 0.1 to 0.4% in all the markets. 

On the domestic front, Govt has secured a way to push the CBI director out and this is another victory after getting the bill passed in Rajya Sabha on 10% quota to EBCs. The only minor set back is the SC reconstituting the bench that is hearing Ayodhya dispute and the next hearing is pushed to 29th. On the Q3 front, there is a disappointment with TCS also coming with below average results. The margins were missed which is similar to IndusInd under performance. So, this will put pressure on the other companies coming up with their Q3, especially Infosys which is going to declare its Q3 numbers today. Other news is the CPI and IIP numbers for December and November months and that will also be another input for Q3 GDP. 

On the derivatives front, there is some buying seen yesterday in index futures with FIIs spending nearly 426 Cr in taking long positions. Still, the long positions on Nifty Futures are at 49% and we started the series at 50%. There was a drop in the volume with Nifty futures volume dropping from 24,123 Cr to 14,381 Cr. The Index options, however, has seen a turnover of 15.7 lakh crore and the Nifty put-call ratio went up to 1.46 from 1.43. 10600 put added 3.6 lakh contracts while 10800 put added 2.7 lakh contracts. On the call side,  11000 call added 2.7 lakh contracts while 11400 call added 2.2 lakh contracts. Still, 10500 put and 11000 call has the highest open interest.

What is the Nifty call for the day? 

Yesterday, I have told you to take the long positions only if Nifty stays above 10820 and as Nifty fell below that and had a weak opening, it is assumed that you would have stayed away. Markets also closed just at 10820 mark and today we will have 10830-10850 opening and that itself is a resistance mark. Weak TCS numbers might put pressure and that might open the downside. 10780 is the last support and if Nifty breaches that we would touch 10720-10750 levels. On the upside, 10850-10880 is a strong resistance that Nifty has to conquer. Till then do not enter into any trade. Today is the weekend, so relax and stay away from any trade today. Today will be more down than up.