Trade setup for 12th May

 Nifty has fallen for 8 consecutive days. In 8 trading sessions, the Nifty has fallen more than 800 points which makes it more than 100 points on average. I saw historical data, nifty has not closed in red for more than 10 days consecutively. Most of the time, it closed for 7 days and on the 8th day, it would reverse. I expected that to happen but that did not happen. Let's see if markets stabilize from next week or will the selling get intensified.

Yesterday markets fell 300 points and broke 16k. Then there was a short-covering rally and nifty recovered 200 points from the bottom. This gave a lot of hope to the traders that the recovery rally will continue. Today that entire rally might be given back as per SGX.

This is the problem in this market. Every rally is getting sold into. 

Yesterday the US inflation data was out and it was worst than expected. The inflation in the US is very high. The US markets started trading in the green when the data came and then in the second half, it fell drastically to close in the red. Obviously, Nasdaq fell drastically. It lost more than 3%. Now Nasdaq is in a deep bear market. Will the tech selling continue??

Tesla fell 8%, Apple, meta fell 5%. In the last week, the US markets have lost $4 trillion in market cap. This is 2X of Indian GDP. That's how brutal the markets can be.

Bitcoin is on a free fall. It is now at Rs 22lak. I remember trading in bitcoin 4 years back when it was 13lak. Now I don't trade in these. But I watch. Crypto called tera has fallen 96% from its high. It means its almost gone.

It looks like markets are going to fall. This is the time for investment. Begin investing in phases below 16000. I am planning to invest 10% of the capital for every 200 points that fall below 16000. I had sold almost my entire portfolio when nifty was around 18k. I felt bad when it went to almost 18500. SIP is overrated and SWP(systematic withdrawal plan) is underrated. If you just keep investing then you will never enjoy the money that you make. It will just be paper money even if it grows. You should know when to take money out of the table and use it for personal use as well. Again, it is easier said than done.

LIC ipo allotment will happen today. I have applied for 2 lots. Looks like I will get both and in the grey market, there was a discount of 90% in the value. Now I am praying that I don't get the allotment. But I am sure I will get :)

We will get Indian Inflation data today. We need to see how that will impact the markets.

Today you have results of Tata mot and lnt. 

800 employees of whitehat jr resigned when they were asked to come to the office. :) WFH is the new trend. The sooner the corporates understand this, the sooner they will grow.


  1. I expected nifty to bounce back when it was at 16300. So I bought some quantities of nifty futures. It did go up after I bought it. I had even put this trade on Facebook and Twitter. But then it fell. So I converted that to covered call where I sold 16200ce. Now I have a cushion till 16000. It looks like today even that will be gone. I may have to add more legs to this trade. Currently, it is sitting at a loss of 5k. I will add one more leg and keep a SL of 10k for the entire trade.
  2. The weekly trades which I have taken are in sweet positon. Its all in wonderful profit.
  3. The monthly trades are in slight danger. But today after expiry, I will be getting margins from the weeekly position and I can do a lot of adjustments from tomorrow.
  4. Today will be the 9th day nifty would be falling. The risk reward is in the favour of the bulls. So I am executing the below trade 
    1. +1 X 16000pe
    2. -1 X 15500pe
    3. -1 X 15400pe
    4. -1 X 15300pe
  1. US is down and out.
  2. Europe closed in the green and gained more than 1%. 
  3. Today Asian markets are down and out. SGX is suggesting a 150 point gap down
  1. I don't know how much more do the FII have invested??
  2. They have been selling continuously in the market every day. FII sold for 3600+cr and DII bought for 4200cr
  1. Crude is at $107
  2. $ is at Rs 77