Charts: SBI - SAIL - RELIANCE
Charts: ICICI BANK - MARUTI - NIFTY FUTURE EOD
NIFTY FUTURE 30 MIN
NIFTY FUTURE:
Today Nifty Future opened with a gap on the back of higher closing in US markets. Once again with support from Reliance, SBI and Infosys Nifty Future managed to go up to 4889 and thereafter retraced to fill the gap and close the day @ 4819. I would like to mention here, that today's resistance at 4900 is probably the last of the major hurdle that Nifty Future has to face before crossing 5000. Above this level, we will be in the same region when Nifty had big fall on 21st Jan 2008 (Nifty range 5691 - 4918). Thus there will be hardly any hurdles for the next 300 - 400 points. Important criteria for this will be that Nifty has to cross 4925. (Please see Nifty Future EOD chart given above).
Considering the weakness in the last half hour of today, it is quite likely that Nifty may retrace up to 4730 - where it will find strong trend line support from which it can bounce and continue the upward march to cross 4925. This does not seem difficult as heavy weights viz. Infosys, Reliance & SBI are all showing bullishness. In the event that Nifty Future breaks 4730, than bearishness will accelerate otherwise the breakout above 4750 after so many attempts will hold good.
In view of the above, i would suggest one can buy 5000 Call @ Rs. 37 and 4600 Put @ Rs. 39. The risk of Rs. 76 may be worth as there are 11 trading days to the FNO settlement.
Considering the weakness in the last half hour of today, it is quite likely that Nifty may retrace up to 4730 - where it will find strong trend line support from which it can bounce and continue the upward march to cross 4925. This does not seem difficult as heavy weights viz. Infosys, Reliance & SBI are all showing bullishness. In the event that Nifty Future breaks 4730, than bearishness will accelerate otherwise the breakout above 4750 after so many attempts will hold good.
In view of the above, i would suggest one can buy 5000 Call @ Rs. 37 and 4600 Put @ Rs. 39. The risk of Rs. 76 may be worth as there are 11 trading days to the FNO settlement.
If you are convinced about the above strategy do try out for a maximum risk of Rs. 76. - may be there is pot of gold waiting for you by the time we approach the FNO settlement. Similarly, i have also given some call buying ideas at appropriate levels in the individual stocks analysed above.
Today the Put Call Ratio for index options remained at 1.38 as against 1.20 yesterday. Such a high level of PCR (indicating cautiousness/bearishness) makes it another contrarian logic for the low risk strategy, stated above.
I have not suggested buying/selling of futures as the volatility may increase. In case you wish to trade futures, please do not forget to use appropriate STOP LOSS levels.
With Best Wishes,
Ketan Asher.
What are the breakeven points for the strategy suggested today?
ReplyDeleteThis strategy (Called Strangle)will have Break even Point of 5076 on Higher side and 4524 on Lower side.
ReplyDelete