Trade setup for 18th Oct



 Yesterday the SGX was suggesting a gap-down. We did a gap-down and then there was a massive recovery from the low. Nifty shot up almost 250 points from the low. The major gains came from the banks. Banknifty shot almost 900 points from the low.

HDFC bank result which was good changed the sentiment of the rally. 

The US markets are also on steroids now.

I did say in my previous blogs that 17k may not be taken out in this expiry. Now I am even more confident on this view. Yesterday I did add more to my trades. It's just that the probability of 17k being taken out again is low. It does not mean impossible. We still have 6 days and anything can happen. Make sure you are ready for surprises.

Finally, nifty closed above 20DMA. Now, yesterday's low will be a new support. I don't think that will be taken out in this weekly expiry. The next resistance is around 18k. So I wont be surprised, if nifty rallies up to 18k by Diwali. To be realistic, I am expecting sume profit booking to come around 17500-700 range.

Banknifty has taken support at 20DMA and then we had a massive rally yesterday. Now, 20DMA is clear support for banknifty.

Now, IT is also contributing as that was a beaten-down sector. I would say, this is more promising than banks for me. I will be having some trades for nov in IT.

The UK new finance minister has scraped all the policies which the old one had done with respect to the tax cut during the inflation times.

Now there is a lot of pressure on the UK PM to resign after the failed budget which she did.

MY TRADES

  1. I was waiting to do an adjustment yesterday as there was a gap down. Since three was a recovery, I did not do any adjustments and now I am sitting with a decent profit.
  2. Yesterday, my algo trades were able to catch the rally downside and on the upside and I was able to make a profit of 3% of the deployed capital. This thing seems to be working with small capital. Can I scale with huge capital?? I do have a plan for that as well. Let's see.
  3. Today I will be executing the below trade in infy for the next month
    1. +1 X 1460pe
    2. -1 X 1400pe
    3. -3 X 1360pe
INTERNATIONAL MARKETS
  1. The US markets are on steroids. It looks like the inflation worries are over.
  2. Dow shot more than 500 points. Nasdaq has shot up more than 3%
  3. Europe closed in the green. 
  4. Today the Asian markets are in the green. SGX is suggesting a 150 point gapup
CRUDE and $
  1. Crude is falling which is good for India. Crude is at $91
  2. $ is not improving but it is not falling either. So for now it looks like the fall has been arrested. $ is now around Rs 82
FII AND DII
  1. DII bought for 1500+cr and FII sold for only 300+cr. Now you know who brought the rally yesterday.






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