Trade setup for 12th Dec



 Nifty was going higher and now it looks like it's in a pullback phase. Is this reversal?? not sure. We need more confirmation for that. As long as banknifty is going higher, this looks like a pull back. I feel that the banknifty rally will also end soon and markets may fall more. The trend reversal sign may come when banknifty breaks 20dma. Till then I will consider the fall as a pullback. Since I am bearish, I will be initiating the bearish strategies only.

Nifty has a strong support at 18300. If that is broken then the fall can be bad.

On Friday, nifty closed at 20dma. Today SGX is suggesting that there will be a 20dma break. We need to see if it closes below that.

Now all eyes are on the FED policy which is happening this week. 50bps hike is what is expected.

It's surprising how the world markets are falling and how we are near the ATH. Banknifty is making a new records every day. 

The IT index is getting beaten. Use this opportunity to get in. Not now. Wait for the fall to slow down. We will get signs that the bottom is near, then enter for investment. I would buy infy at 1500(10%), 1420(10%) and 1350(10%) in phases. If it goes below 1300, then I will start playing in options.

For now, I will be selling 1500pe in infy.

MY TRADES

  1. My algo gave a fantastic 4% profit on Friday. It was able to catch the fall and the rise. For the month, the algo is sitting in a profit of around 6%
  2. I have executed the below strategy in HCL on Friday
    1. +2 X 1050ce
    2. -1 X 1020ce
    3. -3 X 1100ce
    4. -3 X 950pe
  3. The above is a slightly bull trade in hcl. I have sold some deep OTM in infy. So, this will act as a sector hedge for that.
  4. The banknifty short trade which I took at the start of the month is in a decent profit. The view went wrong but due to vix fall, it is sitting in a profit. I have added some more legs so that the profit does not disappear.
INTERNATIONAL MARKETS
  1. The US closed in red on Friday. For the next few days, the markets may go sideways
  2. Today the Asian markets are in the red. SGX is suggesting a fall of more than 70 points.
CRUDE AND $
  1. Crude is at $76
  2. $ is at Rs 82.5
FII AND DII
  1. FII sold for 158cr and DII bought for 500+cr

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