Trade setup for 11th Oct



 Yesterday was not a bad session after all. From the lows there was a massive recovery. Nifty and banknifty bounced from a critical support point. Nifty went to almost 17k and from there it bounced back. Banknifty went to 38500 and from there it bounced back. So these 2 points will support for this week at least. One can easily sell options that are below this for this weekly expiry, definitely with hedge. Make sure you are ready for surprises.

I think I have developed a stable algo. Till now I have not found any major flaws. Fingers crossed :) . For the month of October, the algo has turned positive. Let's see how that will turn for this month. I will not be scaling the capital for this entire month.

Yesterday we had the TCS numbers and the numbers are good. You can expect some rally in the TCS. I had sold PE and it looks like I should be happy with the premium only. Infy ADR was up by close to 3% yesterday in the US markets.

We are getting confusing signals. Nasdaq is at its 2yr low and here the IT sector has started to go up. Can Indian IT go up with the Nasdaq falling??

Infy results in some time and there is a buyback which they are having. Maybe that is the reason for the rally in Infy. Let's see how TCS will behave today.

JPmorgan CEO Dimon says that the US may enter recession in 5-6 months. He says that the markets may fall close to 20% from here. I can tell with certainty that this will not happen. I sometimes fell that these financial institutions create panic so that the retailers rush to sell and they benefit from that. 

Now all eyes on the FED minutes which is on this Wednesday. I personally feel that this may be the end of the fall as the worst has been priced. This may trigger a bull rally. If this triggers a bull rally then the short covering rally will be powerful. 

The US markets are at a strong support area(both nasdaq n dow)



If it breaks this then you can expect more downfall in the market. A similar chart pattern is there in the dow as well.

MY TRADES

  1. I had sold some deep OTM PE in TCS with the hope of taking delivery. It looks like I need to be happy with the premium. 
  2. For this weekly expiry I will be executing the below trade
    1. +1 X 17000pe
    2. -3 X 16900pe
    3. -2 X 16850pe
  3. Depending on today's move, I will think of doing an Infosys earning trade.
INTERNATIONAL MARKETS
  1. US closed in the red. Dow was close to flat. But it was the nasdaq that fell almost 1%
  2. Europe also closed in the red
  3. Today the Asian markets are in the red. SGX is flat to negative.
CRUDE AND $
  1. Crude is falling despite production cuts. So the demand has gone down substantially.
  2. Crude is at $96 and $ is at Rs 82.5
FII AND DII
  1. DII bought for 2137cr and FII sold for 2139cr




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