Analysis and Trade Plan - 9 July 2019

  • We are bearish for now. No doubt about it.

  • I am expecting a little negative opening for the markets. A little negative opening will be good for my positions.

  • We fell 250 and 850 points on Nifty and Bank Nifty respectively. With negative bias, I expect a little sideways movement now.

  • Fall was attributed to various provisions in Budget related to taxing FPI's and increasing retail participation in equities.

  • Nifty had a crucial support at 11600 which is broken now. We may drift towards 11100 levels where the 200 day moving average is.

  • Future activity was very less on Nifty.

  • PCR at 0.33 is super bearish and max pain fell by 250 points to 11650.

  • Change in total call OI was 7 million yesterday with heavy call writing from 11600/11650/11700/11750/11800.

  • Any bounce in Nifty is an opportunity to sell right now.

  • Bank Nifty has a crucial support at 30200. It is the gap high. If broken may drift Bank Nifty more lower.

  • Future activity in Bank Nifty was negligible.

  • PCR at 0.42 is bearish and max pain moved down to 30600. Call writing was visible at all strikes with hardly and put writing.

  • Any bounce will be sold into. Once market opens we will have fresh level to decide on where to short.

  • I am trading with bearish to sideways bias.

  • Optimum strategy will be to do a call calendar or a call ratio spreads for now.

Rohit Katwal

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