Market Trade Setup 8th October
Start of the 2nd week starts and we are yet to recover from shocks of the first week. Nifty has seen the biggest fall in 9 years see at 6.1% and we have seen 700 points getting wiped out in a week’s time. If you see this week, globally things are looking mixed. The US is growing big time, strengthening the dollar and that is making all the other currencies weaker. The jobs data that came on Friday in the US shows that the unemployment rate in the US is at the lowest level in
Domestics and Derivatives!
Coming to the domestics, the biggest jolt was given to us by RBI in our monetary policy on Friday, where the rates have been kept unchanged. The reason given was why should rates go up when inflation is not going up? This is a valid reason but a depreciating rupee needed higher interest rates to stabilize and since RBI did not hike rates to save rupee there was a massive
On the derivatives front, there was a massive selling seen on Friday where 30 short positions were taken on Nifty futures for every long position. That has brought down the overall long positions in Futures market to 36% from 46% seen at the beginning of the series. On the options front, there was a lot of action on the call front and 7 calls were shorted for every 2 short puts and that brought the Nifty
What is the Nifty call for the day?
After 700 point fall in 4 days, what can we expect? Nifty will open slightly gap down today around 10280-10300 level and immediate support will come at 10260 and what happens from there needs to be seen. 10380-10420 is a resistance zone and will Nifty overcome that or not needs to be seen. Today for me is a wait and watch day. After such big falls, its not safe to jump into trades now. Already you have a position and keep it intact and let’s observe the markets today to decide on the further course of action.