A day of rest for the market as NIFTY ended up flat.
Not exactly. There was enough volatility to make traders worry about the direction they should take. Stop losses get hit on both sides in this type of markets.
Opinion of experts is divided about the trend. Some are looking for levels below 11400 while the others are hoping for a return to 11700 and beyond. If there were no conflicting views, markets would not exist. We focus on what we can do and leave the talking to the people on TV.
Our Trades :
Two of the big party poppers were HEROMOTOCO and SUNPHARMA. These two trades alone caused a dent of about Rs. 22000 in our profit figures. Before we start feeling bad about it just remember that only 2-3 sessions ago, we were in worse position.
GAIL did very well for us yesterday. For the record PUT 295 is now PUT 147.5 with lot size of 5334. Entry price of Rs. 3.40 is now taken as Rs. 1.70 to keep the account correct. This stock made the new 52 week low yesterday.
MARUTI too made another 52 week low at Rs. 5910. Let us see what is further in store for MARUTI trade.
Could not get out of HEROMOTOCO PUT 2500 as the expected price never came and suffered for it.
Thanks to other trades chipping in small differences, the position does not look so bad.
As always happens with our new trades, BIOCON PUT 230 was bought and the stock went up immediately. No profit comes without a decent wait.
Another day of wait and watch is upon us. Let us see where does it take us.
Since MARUTI has already breached 6000 and made a low of 5910, we look towards a level below 5900 and exit from PUT 6300 can be taken and PUT 5800 bought at the same time.
New Trades :
If the market has to move lower in the current month, it will not happen without RELIANCE moving down.
Even with the 2.83% up move, RELIANCE just about fits our 30 day and 7 day weakness criteria.
IV is slightly lower at around 28 but we are okay with 25 also in such cases.
Price at close yesterday was Rs. 1283.
We go for RELIANCE PUT 1240 @ Rs. 11.50-12.00.
Lot Size 500 Maximum Risk Rs. 6000.
Trade cautiously, trade profitably.
Disclaimer: This post and examples are for teaching purpose only and are not meant as advice/suggestion to trade in these stocks. Trading in Futures and Options can lead to big losses and should be done with appropriate knowledge and advice only. Mentioning the stocks here does not imply that I have a trading position or likely to take a trade in these stocks.