Analysis and Trade Plan - 23 July 2019
Another day of mayhem in Bank Nifty, although Nifty was not that violent. HDFC Twins were the culprit. Despite that, Yes Bank was the most traded share yesterday.
Kotak Bank is also to be blamed and fell 2.9% for the day. We hit -600 at one point and I was thinking if we will hit -800 today also.
RBL bank has also fallen from 700 to sub 500 levels. Something is cooking and things does not seem right.
Kotak Bank missed the estimates yesterday, so it is to be seen how the share will react once the market opens.
Investors everyday are looking for some positive news and everyday government is coming out with announcements not to their liking.
If not for Reliance and TCS, we would have fallen by 100 points on Nifty today.
Auto Stocks are down by 40-50% from the peak. It can be time for bottom fishing right now. I have a fixed amount which I invest every month. I dont look at technical, but once I like a stock for long term, I buy it. If it goes down, I keep on averaging every month till it moves above my price range. I think its time for me to start accumulating auto stocks.
SGX nifty is hinting at a sideways opening.
Dow Jones was little changed yesterday.
Over the coming few days, Iran - US problems can increase further which can derail the markets and crude oil.
Call writing was evidently more than put writing. Max Pain is moving down. PCR at .71 for Nifty is suggesting a bearish trend, but momentum may fade now as put writing is also coming.
11300 and 11200 can provide support. In the short term going into August, we may touch 11000 also.
For Bank Nifty also shorts are being added.
Call writing was visible on all counters. We might take support at 29000.
We cannot rule out little consolidation before moving further down and hence my decision to do strangles yesterday.
Currently, I am trading with bearish bias.
I am expecting a sideways opening for market today.
I would wait to see what kind of day is unfolding till 11:15 am and decide accordingly.
If there is a goo bounce, I might do some bear call spreads. If there is a good fall, I might do some bull put spreads. If market remains sideways, I am planning to do calendar or an iron fly.