Trade setup for 17th Feb



 Closing above 18100 was needed to take it to 18500. Yesterday's last hour fall did show that there is lack of momentum. It looked like there was an expiry play as well, but today's SGX and world markets are showing signs that the weakness is still not over. 

Now it is clear, that this consolidation will continue for some more days. One can sell 18500ce and 17600 pe. The range is 17800 and 18100. Close the loss making side if this range is broken for this week. The problem now is that the vix is low and the premiums are ultra low. If there is a huge rally then the loss will be huge. So the above trade if for risky traders. I would suggest new traders to stay away for this week as this is expiry week and there can be a rally.

I still have a  feeling that markets will breakout and go above 18100 soon than going lower.

Coming to technicals, nifty is at 50 dma and banknifty is at 20 dma. Looking at sgx now, it looks like banknifty may go below 20 dma and nifty may go close to 20 dma.

The major concern which has come is that the FED is likely to hike more interest rate. Some of the FED people told that they should have hiked 50 bps in the last policy. This triggered the fall yesterday in the dow and this is having a bad handover today to the asian markets. Sometimes, the markets overreact to the comments made by officials. In 2 days, the US markets will forget that and recover. Then you will see a similar rally in the Indian markets as well.

If banknifty falls 500 points from here(on closing basis) then that is an opportunity to short the markets. Till then every dip is an opportunity to go long. But again remember this is expiry week.

MY TRADES

  1. Yesterday my algo gave a decent profit of almost 1%. For the month, I am sitting with a loss of 1%. Hope that recovers today.
  2. For this week, I will sell 18400, 450,500 CE and 17600,550,500 pe. I will close the leg if there is a rally happening on 1 side.
  3. I will be selling 2250 ce in adani ent as I am having a small loss at the moment. 
INTERNATIONAL MARKETS
  1. Dow fell 400 points.
  2. Nasdaq lost almost 2%
  3. Today the asian markets are weak. Singapore exports has slowed down. This signifies that the consumption is slow.
  4. SGX is down 100 points.
FII AND DII
  1. FII bought for 1500+cr and DII bought for 1500+cr yesterday. Not sure why markets fell in the last hour then.
CRUDE AND $
  1. Crude at $85
  2. USDINR almost close to 83. Above 83, markets will fall. This is a real indicator. 



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