Trade setup for 23rd Feb

 Yesterday was a blood bath in the markets. Nifty fell 300 points and banknifty fell 600 points. The covid fears are back. The cases are rising in Maharashtra and Kerala. It was reliance that took it on the chin. It is again back to 2000. Reliance is hovering around 2000 for a very very long time now. Last week it looked like that it had broken out but yesterday it is again back to 2000. Reliance, SBI, tata motors, L&t were some of the major index losers. Banks also lost, but HDFC bank and kotak bank somehow supported the fall in the banknifty. If they had fallen then banknifty would have fallen more than 1000. 

ITC is again nearing the 200 mark which is its favourite number. There are various memes on this in the internet. It fell yesterday due to the dividend ex-date.

India Vix shot up 10%. Obviously, the options premium were very high. The call premiums did not collapse at a good rate. The markets had rallied a little too much after the budget so a correction was expected and for now, it looks like this is a healthy correction provided the market bounces from here.

As expected, the 20 DMA has been broken yesterday. The next support is the 50DMA. If that is broken then we will head lower as the next support is very far. 

Covid has created damage in 2020. Now the same news cannot create other damage. So I don't think that markets will crash like last year. I think even 50DMA will be broken on the lower side. We will be in a consolidation phase for a long time now.

The new girl(bitcoin) has lost charm. It came below $50,000 and is now again back to $52k. It came under pressure when Yellen expressed concerns over the inefficiency of the cryptos.

The RBI's MPC has suggested cutting tax on fuel as we are nearing the Rs 100 mark.

The auto sector is having a semiconductor crunch due to the power outage in Texas. Some auto companies are having alternatives while others are facing difficulty. 


  1. Now I am not doing much trades. I had taken huge positions on the negative side last week and yesterday was just a relaxation day as the money worked for me. 
  2. I closed some position where I had made a good profit.
  3. Today I will execute some iron condor and iron fly.
  4. I had even created trades in stock options at the beginning of the month and I closed them yesterday as the margins started to increase. 
  5. I will not take major risky trades for this expiry as this is monthly expiry and vix has shot more.
  6. I will create positions for the march expiry from today.
  1. The US markets were mixed. Nasdaq fell close to 3%. Tesla fell close to 10%
  2. Dow was flat.
  3. European markets closed in the red.
  4. Today the Asian markets are in red. Japan is having a holiday.
  5. SGX is suggesting a gap up as it fell a bit too much yesterday.
  1. Finally, they started selling. Yesterday they sold for 900cr and DII also sold for 900cr.
  1. Crude is now at $66
  2. $ is at Rs 72