Trade setup for 9th july

  1. Yesterday was a bloodbath at the Indian markets. 
  2. Nifty fell 250 points and banknifty fell 870 points. 
  3. Now no one is talking of 12000 getting broken. Now all are expecting 11000. This is a typical example of how markets always do the unexpected.
  4. Banknifty opened in with a gap down of around 300 points and from there it was just a downfall. No recovery came and every pullback was sold into.
  5. However, yes bank closed in the green after some clarification came from management.
  6. The big boys like HDFC twins, Bajaj twins, reliance, Maruti all started falling.
  7. Tax on FPI(foreign portfolio investment) by the finance minister in the budget says triggered the downfall.
  8. I would say that markets had moved a lot in the last 2-3 months due to the election and other events. They needed a reason for the fall. So FPI came as a trigger.
  9. In a bull market, even bad news is taken as a positive and in a falling market even good news will be taken as negative.
  1. Yesterday was a bad day for me. Most of my underlying portfolio is bleeding. The covered call did give me some profit, but overall I am still in a loss.
  2. I had to close some of my positions in loss and run for cover. The only good thing was banknifty and nifty did not gap down as it closed. It fell gradually after opening and I had time to react. 
  3. Anyway, I did have downward protection. But still that was not sufficient to cover the losses.
  4. Sometimes it is better to respect the market and take the beating. You never fight with the market.
  1. Yesterday the US markets closed in the red. Nasdaq lost 0.78% and dow lost 0.43%
  2. Europe also closed in mild red.
  3. Today morning Asia is in a flat zone. Hang sang has lost 0.7%
  4. SGX is down by 23 points. 
  1. $ is now at 68.55. 
  2. Crude is now 63.85
FII and DII data
  1. FII sold for 400 cr and DII bought 321cr
  2. Seeing the FII data. Not much has been sold by FII. So some bottom fishing may happen at these levels.