Analysis and Trade Plan - 3 October 2019
So euphoria over corporate tax cut is over now and trouble with banks is again rattling the markets.
On Tuesday, following our markets, dow collapsed by more than 300 points.
RBI had to issue a statement on Tuesday to assure depositors that Indian banking system is stable.
SGX Nifty was -0.90% on Wednesday.
In my analysis on Tuesday, I mentioned that we are bearish and I used the initial jump to get out of my bullish positions. Still I got caught into one of my sold puts.
Nifty futures witnessed huge short buildup on Tuesday.
PCR is at 0.56 and pain is moving down.
Collectively on Options, there was a change of 5 lakh contracts. But put were unwinded to the tune of 22 lakh and calls were written to the tune of 27 lakh.
Immediate OTM PCR is also at 0.44
I am not trading bank nifty these days as it has become too much volatile.
There was huge short buildup on Bank Nifty in last two days.
Max pain is moving down and PCR is at 0.40 suggesting bearishness.
There was clear put unwinding and call writing on all strikes.
I will use the gap down or negative momentum to exit my 11600 CE at profit. I will do some intraday trading but with very less volume and in later part of the day.