EquityCompound2

31st Mar'2021 (Evening) Markets today opened under pressure and then could never recover. As mentioned yesterday, Bank Nifty is the weaker index and also lost more today. Profit booking after yesterday's stellar move and also weak global cues due to some anxiety over President Bidens speech today kept the pressure on. Concern however is that there was again some big selling in Cash by FII, coupled with extremely bearish stance in the F&O space. In fact their position in Index futures is completely reverse from Friday. Markets are actually giving no sense of direction. I feel only positional adjustments and Index management is going on. Need to wait for a direction to emerge. Indices however are weak and real strength will only come after the levels mentioned earlier. Dollar Index and Yields made some steep climbs and also led to the anxiety in the markets. Today some cooling off is seen. US markets are also trading in green ahead of Presidents speech. Lets see if this senti...

26th Mar'2021 (Evening) Markets on Friday opened higher and was mostly range bound for the whole day. While Nifty closed almost at the opening level, bank Nifty closed with some losses. Nifty made a Doji candle while Bank Nifty made a bearish candle on the daily chart. FII did not sell big, DII actually bought close to around 1700 Cr in the cash market. This was a second strong buying figure from the DII over the last three days. The strength was pretty good as the market breadth was strong and some short covering was seen on both the indices. A follow up of this is critical for the indices to gain strength.  Over weekend, US closed strong on Friday and the global indices were positive on Monday, when we were closed. This would leave a catch up for the Nifty and Bank Nifty. Our indices would most probably open in green tomorrow. Key is to watch if this gap up is sustained or sold out. I would mostly expect the gap up to be sold out. The low for tomorrow is then important. A breach ...

24th Mar'2021 (Evening) The markets today were extremely nervous on the rising Covid cases and this nervousness led to profit booking. Banking stocks were the prime sells as these are the ones that had run up so much. Fear lock down and related consequences were pushing the selling further and further. Huge shorts have built up at 14700, 14800 and 14900 on Nifty. Bank Nifty also has a huge short built up at 34000 onwards. FII sold for 1900 Cr and this was a substantial selling in some time. While DII bought for 600Cr, it was not enough. Yields eased a bit but then Yields and Dollar Index have been rising together lately. This is not good for EM. Almost all of Asia was under pressure for this.  A risk averse mood is set in and the sentiment could be muted for this and waits for a trigger. Traders are looking for safe investments. After a stellar runup, Domestic institutions and investors would also be in mood of booking profits for financial year end. Tomorrow's closing could be...

23rd Mar'2021 (Evening) The markets saw some short covering today. The movement was drive by financials and Banking stocks. Bond auction cancellation was one reason and Supreme court verdict another for this move. Nifty went above 14824 but could not breach on a closing basis. Bank Nifty also went above 34350 but closed below it. These levels are offering stiff resistance at least as of now. For the upwards journey to continue, these levels have to eb taken off tomorrow. For Bank Nifty the next critical level is 34650 and then 35000.  FII have net sold today, though a bit less. The buying from FII would be critical for further movement from here. Bond yields have eased a bit, however, Dollar Index has swelled. US markets are trading flat as of now. A positive close would be instrumental for our markets tomorrow. US is actually nervous of expected statements from FED. Rising Covid cases in Europe and also in domestic markets is keeping the sentiment muted. So actually a war is on be...

22nd Mar'2021 (Evening) The markets opened on weak global cues today. The Turkish Lira led to some turbulence and Nikkei opened 2% down. Maintained this through the day and kept the Asian markets in pressure. Indian Markets started seeing selling as they opened, only to pick some support in the second half. However, the momentum did not pick up and while Nifty closed almost flat, Bank Nifty closed weak.  Nifty close was above its 50DEMA and BankNifty closing actually breached its 50DEMA.  FII also sold today for 750 Cr, while DII bought, though not as much as FII sold.  Yields have slightly eased and Dollar Index is also marginally low. A further correction in this and and a positive close in US may lift the sentiment for us tomorrow. Nifty seems to have picked up support, though it has to close above 14824 for a continued momentum.  Bank Nifty is at a critical support now and has to remain above its Friday low of 33361. A fall below this may lead Bank Nifty towards ...

19th Mar'2021 (Evening) Finally after a loss for 5 days, indices saw a recovery on Friday. The indices closed with a gain of a percent. I was expecting some recovery, though it came a bit late and on the last day of the week.  We may not be completely out of woods though. Good part was that the 50 DEMA was respected by both Nifty and Bank Nifty and the indices crossed above that. It has to now, cross critical barriers of 14850 and 14950 to gain support for a further rise. The lows made on Friday, could be bottoms for immediate short term. The global markets on Friday were weak and closed in red.  Yields again swelled to 1.73 and Dollar Index is at 91.958 and is again approaching 92. Lets see how does it behave from here. On the options front the range has widened on both Nifty and Bank Nifty, indicating a possibility of further recovery. The wide range is also factoring a fall, though i feel the drop may not be substantial, at least in short term. VIX also support this view. N...

17th Mar'2021 (Evening) Uncertainty prevailed again in the market today. When it was at important support, it breached again. Nifty breached 14772 and Bank Nifty breached 34431. As mentioned yesterday, Bank Nifty has almost reached its 50DEMA now. Nifty unexpectedly also reaching its 50DEMA. 50DEMA is an important psychological support for the indices and i hope these are respected. The bond yields, dollar and Covid have been spooking for long now. I still feel, the steam is not lost. I would keep hopes on these important levels for the following reasons : Indices at important levels. FII buying has been positive for the second consecutive day. FED meeting has kept the bulls on hold. FII positions in F&O are not that bearish. Markets are in oversold condition in near term. We have been underperforming global markets. If there is not adverse comments from the FED meeting today, we may see some catch up trade soon. Yields have surged today by the way. Nifty may see resistance aro...

16th Mar'2021 (Evening) As usual markets are lacking any clear direction. After opening higher and rising a bit, selling started. Rises are not getting sustained, as for some days, buying come in at lower levels. Markets within the range.  Nifty seems to be picking up some support at 15000. The range for Nifty remains 14772-15375. Bank Nifty seems weak in particular. The range seems to be 34431-36497 for the moment. US Bond yields have eased out a bit and Dollar Index seems to be still behaving itself. Market is still waiting for a trigger to move either side. Till then range bound movement continues.  Buying and selling near this range has been working so far. A stop loss slightly outside this range could be maintained. While Nifty seems to be respecting its 20DEMA, Bank Nifty has breached the 20DEMA and is heading towards its 50DEMA. This is a bit below the range i have mentioned above. We have been consistently underperforming compared to US and global markets for the last ...

15th mar'2021 (Evening) Markets have become really choppy. Nifty saw a 300 point fall and then a 200 point recovery. While, Bank Nifty saw a 1100 point fall and then a 800 point recovery. Its long now that every rise is seeing selling and every dip is seeing buying. A typical consolidation phase.  While today both Nifty and Bank Nifty breached the lower limits I have been mentioning, they both saw a sharp recovery from these lower levels. Exact reverse of what happened on Friday, when the higher end was breached and then the indices saw a sharp selling. All in all the range has kind of widened to 14772-15375 on Nifty and 34431-37232 on Bank Nifty.  Today though the call writing shifted lower to 14800 on Nifty and 35000 on Bank Nifty. The OI range indicates a range of 14800 to 15300 on Nifty and 34000 to 36000 on bank Nifty. The uncertainty is driven by the spike in US Bond yields, a rise in dollar index and rise in Covid cases. While today Yields eased to 1.6 levels, Dollar In...

12th Mar'2021 (Evening) The indices gave a surprise move in the second half on Friday. As the market opened higher after a holiday, it was expected that there would be some profit booking. However, at some point in the day it would pick up support. The selling only got aggravated in the second half. I sold puts and they are now in risk. Am managing the positions aggressively now. The range of 14862 and 15273 is was I was indicating on Nifty and 34658 and 37232 on Bank Nifty. While Nifty broke this range on the higher side, it quickly saw profit booking and corrected to lower levels. I expected Bank Nifty to also try a breakout above 36500 and attempt 27232, it did not move. I see the indices still in that range. If the range continues to play, then the indices are at their support. So a move towards the upper limit of this band may be expected. Lets see. Looking at OI Bank Nifty shows a band of 35000 to 37000. On Friday, call writers did not come below 37000, so that gives confiden...

10th Mar'2021 (Evening) The weekly expiry was more or less peaceful. No volatile movements. While the Indices opened strong, they lost gradually, made a low and then recovered approx half the loss. The closing was in red. Bond yields have been getting rejected at 1.6 and are now kind of stabilizing at 1.5 levels. Dollar Index has come down. This could help us. From the time our markets closed on Wednesday, global markets have rallied, leaving us a bit behind. I expect approx 2% gap up tomorrow morning. So the larger decision to be taken now is, if the market opens gap up, should we chase them. We need to confirm if the gap up sustains. Normally these gap ups get sold off and we get an opportunity to enter. Bank Nifty made some attempts to breach 36000 on Wednesday and the last hour movement on Wednesday gave a slight indication of this. So the aggressive weekly put sold, will pay tomorrow. Both Nifty and bank Nifty have been making higher highs and higher lows for the last 3 days. ...

 9th Mar'2021 (Evening) FII came back buying in the cash market with a buying of 2800 Crs. DII also bought for 1250 Crs. All this forced some bears at lower levels to run for cover on Nifty.  Bank Nifty though saw a good movement today and a buildup on futures. Though Nifty is still within the larger range of 14862 and 15273. A breakout is still to be seen out of this range. Bank Nifty is operating within 34658 and 37232. A breakout is yet to be seen. Options OI is showing a support at 15000 on Nifty today. on the upside the range has widened to 15350.  Bank Nifty is seeing these levels at 35500 and 36800. With both Nasdaq and Dow trading strong. Dollar index and yields easing out today. Tomorrow's opening can be expected to be gap up. Though it is important to see, where US closes today. Somehow, we are just following cues from US. Bank Nifty has shown higher strenght today. Wider market has not participated today. It was just banking and IT that led the moves. DOW is cu...

8th Mar'2021 (Evening) Volatility remained high today. While as of EOD, it eased marginally, the indices moved in a wide range. Nifty made a high of 15111 and a low of 14919. While, BankNifty made a high of 35827 and a low of 35090.  Both Nifty and BankNifty have been showing signs of exhaustion for tome time now. Over the last couple of day, the swing high has been lower than the previous high. On the daily chart the last few days show a lower high and a lower low.  Though today's low and high is marginally higher than the previous low and high. The candle though is still a doji kind of a bearish candle, indicating that highs are getting sold off. At the same time, lows are also getting bought. These are signs of consolidation, but the rising bond yields, Dollar Index and Oil are putting pressure and inducing uncertainty in the market. US Yields have risen to 1.585. Dollar Index is today at a crucial resistance, if broken it may start taking support and would start trading ab...

5th Mar'2021 (Evening) The market kept surprising on Friday. Honestly it was getting difficult to sense the movement. Somehow managed to keep my positions in profit.  FII sold in cash on Friday. The shorts created on Thursday were built up on Friday and the longs unwound on Thursday, were created again on Friday. While they are still net long, I feel their position is somewhat dicy.  The yields and Dollar index is spooking these institutions again, so their movements are somewhat tentative. Also, the liquidity in the options markets has biased slightly, as the new margin rules have reduced sellers, while the buyers are same or maybe increased. Look at the option premiums. Commodity prices have eased a bit, but oil is rising. Now, oil, bonds and dollar index rising are all a bad combination for our markets. Looking at the options OI and the buying coming in at lower levels, i feel there is support on the lower levels.  Markets are a bit confusing, i feel we could see a ran...

4th Mar'2021 (Evening) Again, as expected and indicated yesterday, The indices showed a negative move today. Nifty opened approx 220 point gap down. Volatility was high through the day. VIX also rose to 24.15 today. US Bond yield has been blamed for this reason, and the selling was seen globally. Our markets have reacted to the global cues today and would continue to do so, albeit with a higher rigor.  Since Nifty has been out performing lately, the recovery after this selling should be equally strong. US markets are again trading in red today. Lets see how the day ends there. While part of this selling is already factored in our markets, remaining has to be seen. FII created huge shorts again today. Their long to short ratio is now 56:44. This is a bit of reversal from their stance from yesterday. they also sold a bit in cash. Open interest on options indicates a support at 15000 on Nifty and 35500 on Bank Nifty. The band is wide on the options data and I think we need to watch to...

3rd Mar'2021 (Evening) Indices shot up today. The move was huge. As tweeted in the morning today, the call writers had to run for cover and that led to further up move in the market. Huge put writing was seen at 36000 on Bank Nifty and 15000 on Nifty. These are definitely strong supports for tomorrow closing.  After the indices moved above the Friday's high, it was clear that a strong up move will be seen. Todays close on both Nifty and Bank Nifty has been close to the high points. Seeing the US markets a bit sluggish, specially Nasdaq a bit of spurt in the yields and a drop in Dow Futures from the time our markets were open, we may see a gap down opening. This is indicated by SGX as well as of now. I expect that could be a fresh entry point for people missing todays rally. We may see a fresh swing high in next days from these levels. FII flows were maintained today, also coupled with a change in their stance in futures, where they unwound shorts and created some longs. Relianc...

2nd Mar'2021 (Evening) Markets as expected were highly volatile. Nifty moved 200 points and Bank Nifty moved 750 points through the day. Though VIX has cooled off now, so that's a good sign. FII buying in cash market returned so again a good sign. Though they shorted index in huge quantity and also unwound some of their longs on Index. The FII long short ratio has now come down to 59:41. Low in some time. Nifty went down and made a low of 14760. Heavy put writing was also seen at 14800. On the call side 15000 call saw a good amount of writing. So this could be the range for this week. Today BankNifty plunged and took support at 35000 (low for the day). Again rose 400 points to close at 35419. On BankNifty, Huge OI was added at 35000 put and 36000 Call. So this seems to be kind of range for this week. FII have bought in cash and hedged in futures, they also have written more puts than calls, but have also bought more puts than calls. While i expect the market to be in the range ...