July 9/25

Global
  • Dow closed -400 points (-1.5%) yesterday.
  • Asian markets are flat.
  • Dow Futures are flat to positive. DAX, FTSE also similar.
  • SGX is in green with 40 odd points.
Option chain
  • There was short-covering on 10800 CE and pretty much all strikes below.
  • There was writing on 10800 PE, strikes below and even on 10900 PE (but only small quantity)
  • Max pain at 10700. Strike premium is 173. So the range is 10527 to 10873.

  • Similar to this was Nifty Bank. Short-covering in CE strikes and writing in PE.
  • Max pain at 22300. 669 premium. The range is 21631 to 22969.
FnO Data
  • Flat to negative opening. But overall bullish bias.

Charts & technicals
  • On the daily timeframe, Nifty seems to have broken out of the rising wedge and is closing above it.
  • Nifty 200 DMA at 10886.
Plan for today
  • With tomorrow's expiry premiums are too high. We may be in for a flat day for the decay.
  • FIIs have been bullish but have covered significant Index longs. Need to be careful in longs.
  • Going long at these levels takes a lot of conviction and guts. Might need to be looking for better risk-reward opportunities and reduce quantities in longs.
  • Wednesdays are filled with actions from the past few weeks. But the movement has happened yesterday itself, so not relying on that particularly.
  • There's a cabinet meeting today. Need to watch out on news based action.


     

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