Analysis and Game Plan - 20 December 2018

  • SGX Nifty is suggesting a good day for me post Fed announced rate hike by .25%.

  • Above is the chart for my decision making when I was considering shorting a bull put spread and also a bear call spread. I intended to do a bull put spread based on points I wanted to earn, I had bear call spread in mind based on these trend levels. So a bear call spread and bull put spread were and are both right.

  • Another reason for holding the bear call spread was for time being in my favor. Rising market rises slow. Falling market falls fast and more. So 400 points rising was little unrealistic when dow was falling everyday.

  • Nifty and Bank Nifty are going to suffer from a knee jerk reaction and we might pause with the upside rally for some days now.

  • We are still bullish unless data changes.

  • For past few days, max pain and PCR for Nifty and Bank Nifty is constantly rising up.

  • Future OI is less but long are being added.

  • Put writing base of Nifty is constantly rising to near strikes and call writing to far strikes.

  • India Vix has fallen to comfortable level and trend overall should remain bullish in coming days apart from today.

Game Plan: Planning to hold my positions till expiry today.

Rohit Katwal

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