Trade setup for 13th April

 Markets are very very volatile. Suddenly there will be a load of bad news and suddenly markets will behave as if nothing happened and will rally like there is no tomorrow.

Now again the inflation is back. The inflation data which came did not sound good. In fact, it was bad. CPI inflation is at almost 7% which is at a record high. It is almost certain that the next MPC meet will come with a  hike in interest provided there is no surprise in the crude or anything special happens.

Again the crude is above $100. It shot up more than 5% in the last 24 hrs. 

Srilanka has defaulted on the payment of the debts to foreign lenders. India has given them additional loans but it looks like even that may be defaulted by this month-end.

The covid cases are improving in China and the lockdown of the cities might be eased. This news triggered the crude.

TCS came out with numbers yesterday and the stock did not react very badly. It was almost flat. Today you have infy results and you have a very long weekend. 

Nasdaq again closed in the red. It has fallen almost 10% in this month. That's how bad the correction is happening in a major index like Nasdaq. It is definitely having an impact on the Indian IT as well. Midcap IT like birlasoft, mindtree, firstsource have all fallen drastically.

Yesterday it was banks that gave some support to the markets. IT, Metals, and Reliance all dragged the market lower. 

Yesterday nifty took support at 20 DMA. If you see in banknifty, 20, 50 and 200 DMA are almost at the same point. There is still some distance for the banknifty to come to this point. If all 3 are broken on the lower side then banknifty may collapse, but for now that is the strongest index. I am not expecting that to be broken. One can go long at that point which is around 36500 if it comes.

I would advice all not to invest in the current market condition. Keep your investment low as the market conditions are not favorable. You may miss a major rally but the FOMO may make you repent.

HDFC twins are now below the merger news rally. Everything is given back.

Today is weekly expiry as tomorrow is a holiday. 


  1. Yesterday my algo trade worked very well. It gave a profit of around 1% . I have carried some today. So the profit will be more than a percent. I will be doing a complete backtesting and will be allowing people to subscribe to that by next month.
  2. I had taken a put back spread trade in the monthly expiry and that is already sitting with a profit of more than 4%
  3. I will be selling PE of many companies today inorder to take delivery. 
    1. itc 250pe
    2. infy 1600pe
    3. bajfin 6500pe
  1. The US markets closed in the red. Dow opened in the green but gave up everything and closed in the mild green.
  2. Europe also closed in the green.
  3. Today the Asian markets are in the green. SGX is suggesting a flat start.
  1. As I told you before, FII buying in the last week of the financial year might be a trap. Now they are showing their true colors. 
  2. Yesterday the sold for 3000+cr and DII bought for only 870cr. 
  3. Wait for the FII to start buying aggressively with follow  through. This is a very good indicator to determine the direction of the market. I strongly believe that DII and retailers cannot support for long without FII. Its just a matter of time when the bubble will burst. By then if FII turn buyers then it will be very good.
  1. $ is above Rs 76
  2. Crude is at $104