EquityCompound2

29th Jan' 2021 (Evening) Volatility continued to lay havoc. While bankNifty recovered, Nifty continued its journey southward. BankNifty saw support coming in at 30254, Nifty did not see any reasonable support. The risk aversion has been developing globally, but Nifty has been an underperformer for January across all major global markets. Partly this is driven from Budget related uncertainty.  Cash was taken out by FII and positions lightened in futures. Positions being driven through options. @ calls sold for every put and calls bought more than Puts.  My view is that the market has already bought in bad news and unless a fresh Bomb is blasted, do not see a major fall. Though a good announcement may move the index substantially upwards. Volatility through the budget day will definitely be seen. Any clear views on the short term will be made post the budget tomorrow. Till then avoiding leveraged positions. BankNifty generally seems to be stronger than Nifty as of now. For tomor...

28th Jan'2021 (Evening) Today marks the end of Jan series. An extremely volatile end to the first series of 2021. The last three weeks, market was under pressure and the selling and volatility intensified in the last week. On a monthly chart the candle formed is a shooting star, bearish candle with a small body and a large wick above, indicating weakness ahead. On the weekly chart, we see three red candles with the last one with a longer wick below.  The combination of above two, indicates a range bound February, capped on the upper side and may pick up support some where along. A bold decision / declaration in the budget may negate the view above.  FII have turned net sellers over the last few days. With selling intensifying every new day.They have sold for 6000 Cr plus over the last 4 trading day. Though DII came to the rescue today with a buying of 1700Cr. A follow up has to be watched. With the DII selling from lower levels, I suspect if they would buy so early. The buying...

27th Jan'2021 (Evening) FII has sold for the third consecutive day and the selling got intensified. My view yesterday went wrong. The bullish outlook in FnO is today diluted. More shorts were created than longs, more calls were sold and put longs were squared off. The selling is driven from a global sell off today. Europe sold and US is selling as I am writing this blog. Both supports I mentioned were broken today on Nifty, While Bank Nifty is a bit away from the second support i mentioned yesterday. Though, I also warned the volatility may get crazy movements. Nifty is now at an important support of 13956, if broken tomorrow then the next support expected would be at 13865. Major support only comes it at its 50DEMA of 13700. BankNifty is now at its 50DEMA, if broken, now may make a move towards its support at 28976. Though on the upside resistance would be seen at 14230 and 31500 respectively.  FII have been booking profit for the last 4 days. Nifty has corrected by 800 points and...

25th Jan'2021 (Evening) The markets have turned extremely volatile. Nifty after opening fell 160 points in 30 min, then rose 120 points and again came down 115 points, rose 100 points again before falling and closing lower. Wow, a good 100 point plus movement 3 times in the day. BankNifty story is even worse. 500 point movement thrice. The Index movements are just not tradable by option sellers (unless one is extremely agile and skilled). BTW, I am not trading till this month expiry. Though I am active stock based and in cash. With FII selling for a second consecutive day in cash, but taking bullish position in futures and options, I feel the volatility is gonna continue. The range though I feel is similar, as mentioned earlier.  Nifty has a range of 14222 to 14500 till expiry, BankNifty has a range of 31000 to 31500 till expiry. Though, looking at volatility weird movements are possible.  Nifty has support at 14222 and 14039 while Bank Nifty has support at 30893 and 28976. Th...

22nd Jan'2021 (Evening)  As mentioned a day earlier in my post, the data was all over the place, hence a price action watch was necessary to create a view. The worry came true on Friday, seeing the kind of fall and other pointer mentioned below. Markets opened weak and after moving a slight up move, started sliding following global cues. The slide got intensified and though a very minor pull back came in the last hour, it was sold out and market closed at the lower end of the day. FII have sold in the cash market and also reversed their positions in futures and options. They created 12000 plus shorts and unwound close to 6000 longs. Their net position on futures longs went down from 67:33 to 59:41. FII also sold more calls then puts and bought more puts than calls, indicating extreme caution. DII as usual contributed to the selling. The sentiment is dented as of now. Markets are at their support now. Nifty at a range of 14250-14350 and while Bank Nifty has breached its erstwhile su...