Trade setup for 8th may



Sorry for not writing the blog for some time now. I was busy with other work. Markets were in serious overbought positions. So a dip was expected. 
Previously 18200 was the resistance. But then there was a break and nifty closed above that. As I always tell, there should be a follow which did not come. Now, 18200 is a very very strong resistance. 
People can sell 18500 ce for the month and close the trade if 18200 is taken out on a closing basis. Risky players can wait for a follow-through.

Nifty and banknifty RSI was above 70 which showed that it was overbought.

Markets may not fall drastically. 18k has the strong support. One can sell PE below that and keep 18k as the SL.

I expected this kind on of a fall on expiry day but it came on a Friday. Markets were volatile on Friday. Banknifty gapped down, then recovered. In the second half, a second round of selling took banknifty lower. After many days banknifty fell close to 1000 points. 

The main dragger was hdfc twins as MSCI rejig will happen after the merger and MSCI may have to sell almost $100-200 million.
The US markets which was falling has given a sudden upmove. Dow closed in the green on Friday. The earning of some of the tech took the markets higher. Today the US futures are slightly negative. 

Crude has also started to rise as fear of recession has reduced. I had told this a long time back, that there will not be any recession because of some small bank collpasing in the US.

MY TRADES
  1. My algo was able to make a profit of almost 2% on Friday. For the month it now at a loss of less than 1%. We have added 50 accounts in the algo. Get in touch if you want to subscribe. I will be scalling my capital from 6lak to 30 lak after this month for algo. The ultimate goal is to switch to algo by end of this year. 
  2. I am going long on IT. I am selling some OTP PE in Infosys, TCS, techm etc.
  3. 18k to 18500 is the range for this month. One can comfortably sell options beyond this range. For the week I will be selling 18300ce
INTERNATIONAL MARKETS
  1. The US closed in the green on Friday. The tech rally is back. Lets hope this continues.
  2. Europe closed in the green
  3. Today the Asian markets are in the green. The US futures are in the mild red.
CRUDE AND $
  1. Crude is at $75.5
  2. USDINR is close to $81
FII AND DII
  1. Now FII's are buying and DII are selling. 
  2. On Friday, FII bought for 777cr and DII sold for 2100+cr

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