The markets always teach us something. It is up to us whether we learn the lessons or ignore them. Yesterday was again a lesson about reading the market. The situation is really deceptive.
NIFTY was up marginally.
Out of 50 stocks, only 18 closed higher while 32 ended with a loss for the day. Surely majority of traders lost money even with market closing higher. The situation was worse in NIFTY NEXT 50 stocks. This Index closed 0.89% lower. NIFTY MIDCAP 50 Index was lower by 0.83%. Naturally, there was little to cheer about the Nifty gain of 18 points.
We are concerned with our trades and fortunately these did not go wrong badly when the market turned around for the day.
ZEEL went to the lowest point of the day in the first 10 minutes of trades and then moved to Rs. 361.95 from the Rs. 329.10 in the morning trades. It finally ended the day at Rs. 346.75 ( 2.16% lower ). Good for us but was very good at one stage.
M&M and GRASIM too closed lower. GRASIM made the new 52 week low once again at Rs. 701 and closed at Rs. 705. We now look for this option to come into the money.
The new trade for the day in HINDPETRO could not be taken as the stock opened lower and stayed low throughout the day and we did not get our price.
New Trade for the Day :
Generally I do not like to chase the trades. But if we find that all our criteria are being met there is no harm to get into the trade at another strike price.
HINDPETRO meets all the criteria again.
PUT 210 @ Rs. 4.50-5.00 can be considered with maximum risk of Rs. 10500 as the lot size is 2100.
It is still early days in February Expiry and we are already in 3 trades. HINDPETRO PUT 210 can be the fourth trade if the right price is achieved.
We shall look for more trades as the month goes by.
Till then let us monitor our trades and stay alert.
If ZEEL makes another strong down move ( No one knows whether that is likely or not ) we can exit at around Rs. 33-35 range and go for PUT 310 or PUT 300.
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.