ipuneet

Nifty - It was just a short covering rally, resistance at 12180.

NSE:NIFTY   Nifty 50 Index
As expected, following global markets Nifty took a breather today and closed with some gains.

Tomorrow is monthly settlement day, budget is just three sessions away, Corona crisis still looms as large, only certain thing is the "volatility and uncertainty".

On 22nd Jan, when I draw the blue trend line connection lows, I've said this line is important and will provide to direction for a few days, today is the 3rd day, Nifty has closed below this line.

On 9/34 EMAs on Index and RSI , the gap between 9&34, EMAs have reduced further, it is just 14 points now. RSI did recover from the lows in line with Nifty , but remained below 9 & 34 EMAs. RSI value remains below 50.

Short term trend indicator - 9EMA on 21RSI, the RSI is above the 9EMA line on two hour chart, with RSI value being below 50.

Technically, Nifty remains weak but since we have a major even around the corner, trading on short side is not recommended. If one has to trade, 12180 should be treated at strict stop loss.


Delta neutral strategies do help in making some risk free returns in such markets, if you are interested in such ideas / strategies, you may contact me over "direct message" on this platform.


Comments

What would you recommend for budget trade ? Shall we play for the specific range of 11800-12400 or you expect market to give higher movement of more than 300 points in nifty on either side
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ipuneet Sanrid
@Sanrid, Check the maxpain strike on Friday for 6Feb Series, Buy a straddle of same strike for Feb 6 series and sell the same for Feb 27 series.
On the budget day, towards closing you will find some time when the IVs will recede, one such pair can may give you a profit of 2000-4000, depending on how much the Indices will move. Keep 25% of your payin as stop loss, for this position.
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