Tag Archives: Crisis

Market Trade Setup 5th February 2019 #NIFTY

Market Trade Setup 5th February 2019

A good Monday which saw the Nifty climbing the peak of 10900 and closing above that gives way to a challenging Tuesday. Today is all about whether the momentum gained late in the afternoon yesterday will sustain or not. The global cues are looking very positive with FAANG (Facebook, Amazon, Apple, Net Flix and Google) close 2% higher on New York Stock Exchange last night and Dow Jones closed 170 points higher. Today is the lunar new year for China and Korea and most of Asia except Japan and Singapore are shut. Those markets are absolutely flat. Brent crude is touching 63 dollars and that is a bit of a worry for our markets. 

On the domestic front, the Political factors are going to play their role as the 3 judge bench led by CJI is going to hear the CBI plea of contempt of court against the commissioner of Police, Kolkata. That will keep markets on tenterhooks and apart from that focus has now shifted back to Q3 results. Today’s Q3 results include Aditya Birla Capital, ACC Cements, Adlabs, Apollo Tyres, BHEL, Bombay Dyeing, Century ply, Dish TV, DLF, HPCL, Inox Leisure, Kamat Hotels, Punjab National bank, Sobha developers, Tata global, Tech Mahindra, Torrent power, United bank and Zen labs. So far the Q3 results have been average and we need to see how today, which has the core economic stocks come up with their numbers.

On the derivatives front, there was an equal amount of buying and selling that has happened in the Nifty futures market and the overall long positions in Nifty futures still remain at 45%. The futures market contributed 61,900 Cr turnover yesterday while options contributed 5.46 lakh crore turnover taking the total to 6.08 Lakh Crore. The Nifty put-call ratio also went up to 1.67 from 1.63. 10800 put added 5.3 lakh positions while 10900 put added 4 lakh positions. 10700 put still continues to have the highest open interest. On the call side, 11100 call added 3 lakh positions while 11000 call added 2.1 lakh positions and 11000 call still has the highest open interest. So, today is going to be interesting where we have to see if 11000 will be touched or not.

What is the Nifty call for the day?

Yesterday, Nifty behaved as per the script and if you have taken a long at 10840-10850 you are now sitting on a 60-70 point profit. Today will open between 10920-10940 range which is the resistance zone. The resistance goes all the way up to 10980 and there can be a correction at any place between 10940-10980. Unless it is crossed there is no point in taking fresh long positions at these levels. If you still have yesterday’s positions open close them between 10930-10960 levels and exit. No trading today and we will have to wait till the Nifty crosses 10980 and closes above that. Till then we have to wait and watch.

Market Trade Setup 3rd July #Nifty

Markets and News

A miserable Monday which saw Nifty falling 100 points before recovering a bit towards end and close nearly 60 points down. The same trend continued in US markets also where it fell by 200 points before recovering and closing in positive. Today, Asia is mixed with Hong Kong trading nearly 700 points down and this is the direct result of trade tensions and weakening Yuan. Yuan is now at 6.7 which is the lowest in last 11 months and its dangerously close to touching that 7 mark in next few days. Dollar index is again nearing 95 and that would put some pressure on Rupee as well.

Domestic Cues

On the domestics front, NPAs and stressed assets are in news as Govt has come up with 5 point NPA resolution plan which could be in place in next 6-9 months time. The weaker PSU banks will have some benefit. The Crude is stabilizing a bit, and has settled at 77.6 per dollar and that would mean some respite. But strengthening dollar might take the Rupee to 69 levels one more time today and that might bring back some worries in debt market. The core sector data for 8 industries came at 3.6% for May which is a 10 month low vs 4.6% seen in the previous month. Crude dropped to -2.9% and steel grew at just 0.5% and electricity at 3.5% were the main contributors to the fall.

Derivatives Action

On the derivatives front, there was a massive unwinding of longs as Nifty fell yesterday and long positions in futures is back to 37% from 40%. The options market also started demand getting generated to calls with nifty put call ratio dropping to 1.45 from 1.48. 10700 put saw 1.6 lakh positions unwinding, while 10800 put saw 1.8 lakh positions unwinding as Nifty moved towards 10600. 10400 and 10500 puts saw 2.2 lakh positions each building up. Now accumulated open interest is moving towards 10500 from 10600 and at 80 rupees premium 10420 is building as a new floor to the market. On the call side 11000 call had 3.5 lakh positions and 11100 call 2.9 lakh positions built up to eat to 20 rupee and 10 rupee premium there.

What is the Nifty call for the day?

We might open positive today around 10680 levels which is the 50dma and whether it will cross that or not needs to be seen. The 20dma is 10750 and Nifty might spend some time in that range if it stays above 10680. Luckily you dont have any positions and it is better to wait and watch before rushing into any positions. If 10680 is not held and if it falls to 10650 then yesterday’s low of 10600 could be a support and that should be held. So wait and watch!!