Trade setup for 20th Jan

 Another bad day for markets yesterday. All expected that markets would rally and make an all-time high but it reversed after going near ATH. In Jan, nifty shot 1000 points and in the last 2 days it has given up 400 points. Now the talk of the town is inflation, inflation and inflation. 

Bajaj financial result was splendid and everyone expected it to outperform but it fell 2% at the end of the day. In the morning it was up by more than 2.5%. So for the day, it fell close to 5% intraday.

Yesterday the Nasdaq entered into the correction zone as it has fallen more than 10% from its recent highs. 

Pullback means 5-10% fall, correction means 10-20% fall and crash means beyond 25%. Let's see if Nasdaq bounces back from here.

All the techs in the US markets are under pressure.

Paytm is below 1000 and it closed below 1000. Now I will wait for a bounce and if closing in above 1000 and if there is follow-through on the upside then I will invest some for a long time.

10-year bond yield is now low after trading at multi ear high.

Bajaj auto numbers were good. Let's see if that will shoot up today or not. Today you have asian paints and hul come out with numbers.

Chinese central banks have slashed the rates. 

There is some geopolitical tension in russia and ukrain. There is some geo political tension in the middle east. So crude is not showing any signs of cooling. If these gets escalated then crude will shoot drastically.

UK inflation data was out and was at 30 year high.

I am expecting markets to fall after the budget and recover during UP results.


  1. I am still carrying the short position in nifty futures. It looks like I will have to close them today. I will be closing in the wonderful profit. Now I am feeling why I did not short more. When you don't trade or if your volumes are low then your analysis is always right. Anyway, I am happy with the profits made.
  2. Now my butterfly trades are slightly stable. It was in the danger zone when nifty rallied continuously for many days.
  3. For today expiry, I am expecting markets to close in the flat zone. So I am taking this trade in the morning
    1. +1 X 18000pe
    2. -1 X 17900pe
    3. -1 X 17850pe
    4. -1 X 17800pe
  1. Yesetrday the dow fell 300+ points and Nasdaq lost more than a per cent. 
  2. Europe closed in the green
  3. Today the Asian markets are mixed. Hongkong and Japan are in the green. Taiwan is in the red. SGX is suggesting a negative start. But SGX may be wrong. I am expecting nifty to close in the green today. Lets see.
CRUDE and $
  1. $ is at Rs 74
  2. Crude is at $87. Still it is high and crude movement will now depend on the geopolitical tensions.
  1. FII have sold for 8kcr in this month. Yesterday they sold for 2700+cr and DII sold for 200cr.
  2. Sometime back, everyone were telling that FII are selling and DII are buying and the markets are going up. Markets will rally if they turn buyers. I told them that FII are selling and DII are buying and what if DII start selling which is exactly what is happening now?


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