Analysis and Trade Plan - 18 December 2019

• Nifty future witnessed long buildup. We hit a new all time high. Down move and buildup on Monday was fake. It also shows how big players fake the market data.

• Max Pain moved up to 12100 which is bullish. PCR at 1.65 is extremely bullish right now.

• India Vix eased further to 12.62, down 6%. Again a sign that there is not much fear in the market right now.

• FIIs were net buyer of 1248 crore and DIIs were net seller of 908 crore giving a net buy for the day.

• Monthly Max pain moved up to 12100 after a long time which is a bullish signal again.

• On weekly options 19 Lakh Calls were shed. 37 lakh OI was added to puts.

• From 12000-12150, 35 Lakh OI was added. 12100 calls saw the max unwinding of 10 lakh.

• 12100 happens to be the strike with Max Call and Put strikes right now. A little more shedding on 12100 and then Max OI will shift to 12200.

• Monthly data is more interesting. 12000 happens to be strike with max calls and puts. Apparently 12100 calls saw unwinding of 5 lakh and 12000 calls only witnessed 1 lakh OI unwinding. So 12000 straddle must exist in system right now. 12000 to 12150 puts added OI.

• Bank Nifty witnessed long buildup but volume was not much.

• Max Pain on 32100 is also moving up. PCR at 1.19 is bullish.

• Option Data on Bank Nifty weekly is also bullish.

• SGX Nifty is flat right now.

• Overall I am trading with bullish bias on #Nifty and #BankNifty

• I might cut my short positions on Nifty 11250 call and Bank Nifty 32700 Call if necessary.

Stock Picks

• I am bullish on IGL and Bharti Airtel for this expiry. Credit spreads can be initiated on them.

• In Option Buying, I am looking to buy #Tatamotors 180 CE, #Hindalco 215 CE and #Canbk 230 CE. I will use my intraday filters to time the entry.

Rohit Katwal