Analysis - 26 October 2018

  • I cannot sense a trend or a direction right now in markets. Charts and data is all messy and it is too early to say.

  • Dow Jones ganed 1.63% yesterday.

  • With the kind of fall Crude Oil had, we are not going to be worried due to it for short time. Rupee has also stabilized at these levels.

  • Result of ITC and ICICI Bank are scheduled today.

  • We have been talking of market bottoming out at 10000, but we havent touched it yet. I have a feeling we might touch it before moving up. Its not time for bottom fishing yet.

  • When much of the movement is in gapdown or gapup, it is hard to predict whether marketis bullish or bearish even with data and technical analysis.

  • Max Pain for Nifty November month is at 10500 and pcr at 1.34 which is bullish, but it is early to see it as a sign of reversal.

  • Bank Nifty PCR is again touching 0.51. I cannot rule out a strong bounce in such conditions.

  • I am expecting a little gap down opening.

Conclusion -

  • Markets are bearish but cannot rule out a bounce.

Game Plan -

  • Its wait and watch time.

  • If bank nifty touchs 24400 today, then I might add 2 lots of bull put spread. I am hoping for a bounce back and only targetting 42 to 46 points.

Note - Lot Size of Bank Nifty is decreased to 20 with margin requirement of approximately 37,000/-. This is going to affect the profits.

Rohit Katwal

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