NIFTY, Reliance and DLF

NIFTY is forming higher high on daily basis.
Japan visit of NAMO is one trigger, US visit could be another. Nobody is willing to hear any adverse news, no one is caring for SC judgement for coal allocations. All problems of our country have vanished and there is hope that whatever small issues such as inflation, decreasing IIP, supply scarcity, bank NPAs, current account deficit, unequal rain, rising dollar-falling rupee etc are remaining, those will be taken care of by this new Government.

But as a short term trader one should not try to read too much and worried about future. He should just ride on sentiments and liquidity, and he should learn to ignore fundamentals. This could be for investors who think for September 2015, 2016, not for us who are keen to anticipate what will happen in September 2014.


NIFTY

If NIFTY crosses 8000 mark on Monday, it could reach 8170 levels very soon. So plan your retracement trades accordingly.

Bull spread strategy in NIFTY
Buy 8100 CALL around 55 and sell 8200 CALL around 30.
Maximum loss would be Rs. 1250 and maximum profit potential could be around Rs. 3750. This is reasonably safe strategy and one should enter as many lots as possible and book profit as soon as one sees 2% gain.

It will be extremely difficult for NIFTY to cross 8300 before expiration so keep accumulating NIFTY 8300 CALL sell contracts starting from Rs. 20/-

Reliance:

It is in general uptrend!
There are various ways one can trade depending upon risk appetite.

Maybe new 3rd wave is staring, with 161% retracement target around 1065 in cash.
1) Buy Reliance future with SL 975 in cash. OR
2) Buy Reliance 1040 CALL around Rs. 13-15, Maximum loss Rs. 3750. Book profit around 25-27-35 within next 5-7 trading sessions or see for cash price reaching 1065 level to book profit  OR
3) Bull spread strategy:
Buy 1000 CALL around 30/- Sell 1060 CALL around 8/-; maximum loss Rs. 5500/- maximum profit around Rs. 9500/-

DLF:

DLF is in down trend. It is well set to go to 149-150

One can trade multiple ways.
1) buy 150 PUT around Rs. 1.50/-, maximum loss Rs. 3000/-
2) bear spread strategy: Buy 170 PUT around Rs. 5/- and sell 160 PUT around Rs. 2.75
Maximum loss 5200-5400/- maximum profit Rs. 15000/-
3) Sell future with SL 177 in cash.

One can even combine Reliance and DLF trades:
Buy Reliance 1000 CALL around 30 and buy DLF 170 PUT around Rs. 5/- Maximum loss Rs. 17500-18000/- but unlimited profit potential.
OR
Buy Reliance 1040 CALL around 13 and buy DLF 160 PUT around Rs. 2.75. Maximum loss Rs. 9500-10000/- , however, unlimited profit potential.


Disclaimer: This blog does not take any responsibility of your profit/loss



  

Traders with very high risk appetite could buy 7900 PUT around Rs.5/-

NIFTY in recent past always gone up by at least 80-100 points prior to long weekend. It gave Doji candle yesterday. It indicates confusion in traders mind.
NIFTY has consolidated during past four trading sessions and might cross 7980 today and close near 8000.
No good lottery trade. Especially this month is not good enough to invest in lottery trade. Most of the trades this month went wrong and hit SL.
Some of them were good, fetched descent  returns but not enough to close trading account in green.

So no new trade.
However,traders with very high risk appetite could buy 7900 PUT around Rs.5/-
Just Rs. 250/- investment has potential to give 5 fold return on expiry day if traders decide to do some profit booking at higher level post 2 pm.

Disclaimer: This blog does not take any responsibility of your profit/loss  

Buy 8200 CALLs of September expiration around 20-25. and 7600 PUT around 22-25 of September expiration.

NIFTY is all set for next 100 points move.
If it crosses 7990/8000 in next 2/3 days then chances of Wolfe Wave to take NIFTY to 7500 is almost nil.
Several shorts must be trapped in this unexpected bull run for last 10 trading days and one could see short covering and roll over today/tomorrow. It could take NIFTY to new high.

All bear theories have failed so far.
IVs are at all time low. No point in selling CALLs.

Buy 8200 CALLs of September expiration around 20-25. and 7600 PUT around 22-25 of September expiration in small quantity.

Disclaimer: This blog does not take any responsibility of your profit/loss

One can take small risk by buying SBIN 2500 PUT around 20/-

NIFTY closed in red after many sessions. Perhaps it was minor reaction of market on bypoll results. But media management is worth noting here.National newspapers, TV, business websites and especially social media activists are not commenting about it.

Will NIFTY go further down?
It is difficult to answer.
There is merit in holding 7900 PUT though. NIFTY could see some more downside if EOD close below 7840. One must not forget wolfe wave theory target is sub 7500!

SBI

SBI is now at upper end of the channel. It could be bearish till it crosses, yesterday's high.
One can take small risk by buying SBIN 2500 PUT around 20/-, target for two days around 60.
In chart, SBIN again entered in to ichimoku cloud and could go to  S2 level which is around 2440 in couple of trading sessions.
A small 2000-2500 risk could fetch 100% profit. If market declines on expiry day, one can see 2300 level in SBIN, which is bottom of the channel and in that case option could go near Rs. 160-180-200!!!

Disclaimer: This blog does not take any responsibility of your profit/loss

Risk taker should buy 7900 PUTs

NIFTY started moving in channel again. It is at upper end of channel and chances that it could cross 8000 in couple of trading sessions.
EOD close below 7840 is must for bears.
One can go long with SL 7840.
FIIs are buying heavily. Yellen did not do anything and easy money will keep flowing to India for some more time it seems at least till end of 2014 and traders are hedging their bets by buying options.

No point in doing any new trade today.
This 400 points rally in 10 trading sessions always formed higher tops, gave all time close every alternate day, backed by FIIs buying, lot of Euphoria in market. But no point in buying PUTs because chances that they will end up worthless in this bull run and selling CALLs might not be profitable due to very low IV.

Risk taker could buy 7900 PUTs, it will be cheap with gap-up opening.

Disclaimer: This blog does not take any responsibility of your profit/loss

buy NIFTY 8000 CALL around Rs. 15-16 and 7750 NIFTY PUT around Rs. 10/-

Book profit in SBI CALL

NIFTY is moving in pattern, forms flag patter periodically. It could give new breakout any day. Maybe traders will wait today for Fed announcement due tonight, but it seems more or less everybody is convinced about usual dovish stand by FED and  pumping in money in equity markets all over the world.
If Yellen does not do anything and decides to follow Bernanke's foot prints, markets will cheer that and on Monday, NIFTY will cross 8050 otherwise it could again retest 7600 before expiry, prior to it's further up-move. (See chart).
EOD close below 7840-7850 could indicate start of a mild down-trend.

To trade this view,
buy NIFTY 8000 CALL around 15-16 and 7750 PUT around 10. A small investment of Rs. 1200 could fetch descent profit.

Disclaimer: This blog does not take any responsibility of your profit/loss

Buy 2450 SBIN CALL between 22-24

A perfect consolidation day today. It was expected. After seven consecutive higher lows, it formed lower low, though one must not forget today also it formed higher high.
There is lot of liquidity.
Strength in Rupee, drop in oil price will ignore Fed worry and higher US index (above 82) for sure.And NIFTY will use all these as impetus for at least 100 points up-move tomorrow.
For past few days IT and banking did not participate in rally and tomorrow could be their day. There is rumor that Government has approved holding company structure for banks. If this is true then Bank NIFTY will go up by at least 300 points and NIFTY by at least 70-80 points.
No weakness.
Stay long.

SBIN
buy 2450 SBIN CALL between 22-24. Just Rs. 3000 investment could fetch good returns.

NIFTY

See second breakout (blue spot) and stay long for target 7975-7985 for tomorrow. Buy NIFTY on every decline tomorrow, or simply buy it till the time it holds 7825 till expiration this month.
It seems there will be gap up opening tomorrow and one can buy immediately after day open with target 7975 and SL should be today's (Wednesday) low around 7865.
In bull market 7865-7860 could be a good support and should not be broken on EOD basis till expiration this month.

 Disclaimer: This block does not take any responsibility of your profit/loss.

No new trades. Stay long in NIFTY, even if there is 40-50 points correction. Look for an opportunity for long entry

IIP data was negative: NIFTY went up!

No policy announcements in PM speech, SGX NIFTY was down after the speech but NIFTY went up!
Geopolitical concerns go up and NIFTY too goes up!

All quarterly corporate result were known by now, nothing spectacular there but NIFTY did not stop upward momentum! 

Dollar crossed 60 mark, but did not stop NIFTY up-move and when it went marginal down NIFTY went up sharply!
Lesser monsoon than average, NIFTY does not care!

Now oil prices are going down and NIFTY might find another reason tomorrow to go up, although NIFTY did not correct when oil prices were near 105. 

Optimism, hope and feeling of left out taking stocks and NIFTY to new high everyday.
I read, lot of money is flowing in Indian market from Russia. Anything is possible from here.
In short, NIFTY is consistently neglecting all negative cues and responding positively to even the slightest of positive announcements.

Bank NIFTY
If it crosses EOD close, then it could go anywhere.
Till then one can trade with negative bias, due to trend-line resistance.
If it crosses EOD close then, then just buy Bank Nifty or SBI. Recenly, stocks do consolidate at higher level and then show good flag pattern with 2-3% movement during the day. Today could be the day of SBI.

NIFTY
NIFTY, if crosses 7920, could go to 7985 very quickly.
Don't do anything with negative bias in NIFTY, even if it shows 40-50 point correction during morning hours. Global cues are positive, oil prices going down, gold becoming cheaper, dollar is near 60 and all this small things could have big positive impact on NIFTY.
See chart, after first blue spot (first breakout), NIFTY gave another breakout day before yesterday.
Yesterday it did not do much and consolidated at higher range and must be making stage for another big up-move till 7990 today/tomorrow. Then 14 day RSI would go above 65-70 and one could see some profit booking.

Disclaimer: This blog does not take any responsibility of your profit/loss

No new trades

Most of the views in this month were wrong and hence trades went wrong.
Book profit in bull spread strategy in NIFTY.
With this speed NIFTY could close near 8000 in this month. Lot of optimism about Modi government and media management taking NIFTY and other indices at new highs. But this is happening since February. More than 2000 points in NIFTY in less than 6 months is phenomenal by any standard. Moreover, NIFTY gave fresh breakout today, it could cross 7920 tomorrow and march towards 8000.

Exit all positions, and do not enter in to any fresh short positions. Book loss in NIFTY PUT positions, if you can not bear loss.
There is no point in hoping NIFTY will correct 5% from here and 7700 PUTs will end up in profit. So better not to carry deadwood.
Premiums are low, so no point in entering in fresh CALL sell contracts and at the same time buying CALLs might not fetch good profit too. One can buy 8000 CALLs after couple of days if market consolidates around present range.

In short, no new trades for next couple of trades.


Disclaimer: This blog does not take any responsibility of your profit/loss

Buy PUTs

PM speech ON August 15 was well received by media and given lot of coverage. It is anticipated that it could give new boost to the market.
By and large there was nothing new.
All earlier PMs were asking foreign investors to invest in India. Everybody was talking about reducing poverty. In past everyone spoke about reforms. In broad sense there was nothing new, but in all business channels social media and business websites this is being portrayed as one of the greatest speech ever by any PM. According to media. this gave direction to our country.

How SGX NIFTY reacted?
After NAMO's talk it went down by about 50 points from the top. It did recover during the day but did not cross the top.
It again dipped after EU and US markets went down on Ukraine worries. But recovery was much sharper too, or  I must say much faster than western markets. So there is very positive under current. Investors are believing in India and in Modi. Lot of them must have missed earlier rally and would like to buy on every dip.
European indices down by 100 points, DOW is down by 100 points and SGX NIFTY is mere 10 points.

Perhaps one could see marginal gap down opening and gap could be filled within no time. Again NAMO effect. About banking, "dhan jodo yojana" ie bank account and Rs. 1 lac insurance for every poor (I am not sure how poor is defined here), it could be good for our nation in long term, but there is no direction by NAMO, from where money will flow in. Ultimately, it will be of investors' and tax payers' money and I am not sure whether investors will be happy to hear that. A normal investor would think for himself first and then nation! He would withdraw his funds from PSU banks and insurance companies for the time-being.

How to trade this view?
Buy PUTs, they are cheap.
Buy NIFTY 7700 PUT between 30-35, buy BN 14600 PUT around current market price.

This has a potential to give good returns on very small investment.

Disclaimer: This blog does not take any responsibility of your profit/loss

Bull spread strategy in NIFTY

If this IIP and inflation numbers would have posted in era of UPA government NIFTY would have fallen by 100 points.
Rate cut possibility will not be there for at least one year. GDP target for 2014 is difficult to meet. Rupee is depreciating everyday and crossed 61 mark and before month end it could touch 62. Global concerns are still around but both FIIs and DIIs are buying in Indian markets, and today NIFTY sustained gains backed by good volume.
From option data, huge addition of 7700 PUTs just before long weekend proves that traders are convinced that at least for next few days NIFTY will not go below 7700 or considering premium it will not go down below 7640.
All this indicates bull run is to stay for few more days. See chart, it has to cross key resistance 7770-7792 tomorrow, and it could happen with the help of gap up opening. One may see lot of volatility during final hour, before long weekend and for a safe trader, it is better to stay away from NIFTY tomorrow.

One more important observation, in bull run, whenever there is trading holiday in India like August 15, SGX NIFTY is being traded and invariably it gains at least 100 points. As a result, first day after trading holiday sees gap up opening of 100 points.
So with this calculation, you might see NIFTY touching 7950 on Monday morning.

Do not short in this market. Only look for buying opportunities. Though everything is based on mere hope, let us not hope against hope and think NIFTY will reach 7200 anytime soon. In spite of lack of participation from mid-cap and small-caps today, NIFTY managed to end day in green. NIFTY used IIP data for consolidation. Today Bank NIFTY (BN) did not participate, in fact beaten down but tomorrow (Thursday) could be different and one can see 100 points rally in NIFTY backed by BN.

Of course, this is just one view and more or less consensus on street, and generally markets rarely follow consensus!
But still only advice could be, go long in this market, till NIFTY stays above 7650 (+ 20 points as buffer) on a closing basis.

Bull spread strategy in NIFTY

Buy 7800 CALL around 48 and sell 7900 CALL around 18.
Maximum loss about Rs. 1500/- whereas profit potential around Rs. 3500/-
Exit the strategy if NIFTY trades below 7620 on EOD basis till August 20.

Disclaimer: This blog does not take any responsibility of your profit/loss

No good trades for an option trader

NIFTY stuck in a broad range.
Everyone who had missed the rally is pumping in money. Today FIIs also bought (net buyer) in cash though not in usual huge quantities. They did so  after a gap of five days.
IIP and inflation numbers announced after market hours today are not good. Geopolitical concerns are around. GDP growth could be a big question mark.

However, everyday NIFTY is going up even on low trading volumes.
Traders are betting on NAMO's speech on 15th August. He is being portrayed as neo Masiha.

What do we do as a trader in relatively predictable market?

Buy when NIFTY goes near 7400 or sell NIFTY 7300 PUTs when NIFTY is near 7500.
Sell when NIFTY goes near 7850 or sell NIFTY 7950 CALLs when NIFTY is near 7800.

Tomorrow in spite of all negativity NIFTY could touch 7800 or on August 14 NIFTY could cross 7850 if it retains this momentum.
Sell NIFTY 7950 CALL between 22-25. Or buy 7800 PUT around 50.

Most importantly even if NIFTY opens gap down due to global cues, it will be very risky to short in this market. As long as NIFTY is above 7660-7650, do not even dream of going short in the market. See the NIFTY chart. It seems it is forming flag pole, though volumes are not very supportive! So don't short.

Bank NIFTY (BN)
Take CALL sell position in BN when it reaches near 15450-15500.
One could able to find good 16000 CALL sell opportunity then.
BN had broken the range on downside, and tomorrow it could regain the levels in the range and could continue up move.

Premiums are low and it does not offer good CALL sell opportunities now. Once it goes in channel and reaches near 15500, it could provide CALL sell possibilities, maybe on August 14 or on August 18.



Disclaimer: This blog does not take any responsibility of your profit/loss


  

1) Sell ICICIBANK 1620 CALL between 5-6 2) Risky trade in NIFTY PUT

RBI policy turned out to be non-event but NIFTY continued upward movement.
This is very range bound market. Slowly it is reaching at higher end of the band. Today it did cross major resistance, still volume was not very significant.
FIIs started buying again and net buyers for last two days.

ICICIBANK
RBI event is over. Stock is rangebound.
Sell 1620 CALL between 5.00-6.50.

NIFTY
Still contra trade looks promising. It could turn out to be more profitable trade.
Do it very carefully, if you take this trade, monitor it with strict SL.

This is very risky trade, against market direction.
Buy 7600 PUT between 53 to 49, SL 42 and target 65/79/85. Manage trade with trailing SL.

Book loss in 14400 BN PUT contract.

Disclaimer: This blog does not take any responsibility of your profit/loss 

If NIFTY goes to 7850, then use that opportunity to sell 8100 CALLs.

Hold 8000 and 8100 CALLs.
Hold 14400 PUT. Maybe one can average with equal number of lots. Keep a close eye on market at 11 AM. And perhaps we would get chance to book profit before 11.30.
Today NIFTY and BANKNIFTY bounced from respective demand zones. This is power of bull run. If movement today is just short covering, then slight negative commentary will slide NIFTY by 100 points and BN by more than 400 points tomorrow.

If NIFTY goes to 7850 after RBI policy, then use that opportunity to sell 8100 CALLs.

Disclaimer: This blog does not take any responsibility of your profit/loss

Buy OTM PUTs. This could turn out be most profitable trades this month at very low investment.

NIFTY is at very uncertain stage today.
We are in all time bull run where every small dip is being bought.
Everything will depend upon next trigger at 11 AM on Tuesday, RBI policy and associated commentary. If Governor decides to curb inflation and to take tough decisions NIFTY will see 7350 level before end of the week, on the contrary slight positive statements, no changes in key rates will see NIFTY touching near 7850.

Usual CALL sell positions will be taken post policy announcements.

NIFTY chart:
See both options possible but looking at open interest more possibility of some more downside after policy announcement.
Hold 8100 and 8000 CALL sell contracts.

BANKNIFTY
Again all eyes on Tuesday.
BN might give some bounce back today.
There one important gap between 14307 and 14747 generated around election result day on May 16. It could not be filled yet and last time BANKNIFTY bounced back from that region ie on July 14.

If this gap is filled on Tuesday BN could slip to 13900.

Keeping this view in mind, buy 14400 PUT between 80-100. I agree this is OTM PUT and against our standard strategy during start of the month, but this small Rs. 2000-2500 investment could pay-off if Tuesday's Governor's commentary is not market friendly.
FIIs are selling.
Generally, historically August is not good month for market.
Geopolitical concerns are deepening.
Inflation data for this month may not be very encouraging.
Hence, I think there could be 5-10% correction before NIFTY/BN takes off again to continue bull run.

LT

Buy 1300 PUT between 4-5
LT could go near 1340-1350 in this week and one could gain handsome profit in very small investment of Rs. 1000/-

TATAMOTORS

Double top formation.
It could see 390-400 levels if this pattern works.

Bear spread strategy
Buy 410 PUT around 5-5.50 and sell 400 PUT around 3.25-3.75.
Maximum loss could be around 2000/- maximum profit potential Rs. 8000/-

OR
Sell 520 CALL around Rs. 1-1.20

Disclaimer: This blog does not take any responsibility of your profit/loss