An interesting day for the index and for our trades on Tuesday.
NIFTY had a negative close after 5 days of positive trading.
It was not so simple. At one stage NIFTY was down 90 points. Thereafter it started moving up and ended the day with slightly negative close.
I had written yesterday:
“Picture became a little better than previous day but there is no cause for jubilation yet. A profit is not a profit till the trade is closed. The need of the hour is to stay cautious with our trades.”
This proved true for HEROMOTOCO trade. PUT 2800 moved up to Rs. 85.00 and then came back to Rs. 36.35. It is still profitable but the dream of a big profit is put on hold now.
Almost similar move was seen in BHARATFORG, This stock staged a smart recovery from the low of near Rs. 473 to be back at Rs, 484. Again it was a big set back to our expectation from this trade.
INFY improved towards close. Good for us.
The three good performers for the day were TATASTEEL, M&M and ZEEL. All of these made a nice down move and did not recover when NIFTY was recovering. That gives us hope for today.
The new trade for the day was IDEA PUT 31 which did not do well. The stock had fallen 13% over previous two days but moved up on the day with negative close. We can not win them all and can not win on every day. We take good with the bad and look forward to another day.
With few trades going well yesterday, this was the situation.
I would like the readers to tell me whether any of them moved out of HEROMOTOCO trade with a good profit and entered a lower strike option.
Not that it was necessary to be exiting but whether someone actually did it.
New Trade for the day :
One of our old favorites RELINFRA is trading very close to the 52 week low. It is down over 30 day period as well as 7 day period. The stock is highly volatile and the current IV ( Implied Volatility) of the near PUTS is in the range 50-55.
CMP is Rs. 278.95. We go about 5% away from the current price. That would be Rs. 264. Available strike prices are 270 and 260.
I would go for PUT 270 @ Rs. 5.00- 5.50. Lot size is 1300, maximum risk is Rs. 7150.
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.
Comments
Jayanth B.R. January 23, 2019 at 8:57 am
Good Morning Sir,
ReplySrinivas and myself could not exit at peak but we got out @ 66.10 and re-entered towards the close @ 43.15 (same strike) – Booked some profit.
admin January 23, 2019 at 9:07 am
Dear Jayanth,
Well done. Let us hope the move down resumes.
Cheers.
ReplyG Bhaskara rao January 23, 2019 at 9:00 am
Dear sir,
ReplyI have bought heromotors at 25 and sold at 80.
This is my first trade in potions…feeling happy
Thank you sir
admin January 23, 2019 at 9:06 am
Well done. Good trade. Beginners need and get all the luck.
Cheers.
ReplyPrince Nahata January 23, 2019 at 9:11 am
I booked heromotoco @75 which was bought@25.I think I was lucky to have exited it .My reason was that It was showing ₹10,000/- profit and I thought that this stock mostly is of low volatile nature as also expiry is approaching and good to book profit when the notional profit touched 5 figures.A weird reason though & I know it’s against your teaching but Fear of loosing notional profit and thereby ending in losses drove me this conclusion
ReplyAnand Kumar January 23, 2019 at 9:38 am
Sir,
Relinfra lot size is 1300
Replyadmin January 23, 2019 at 9:50 am
Thanks. Corrected.
ReplyAkash January 23, 2019 at 9:44 am
Hello Sir
Replyis it good to consider previous day” Percentage of Deliverable Quantity to Traded Quantity” on NSE,
before entering in the call or put option contract in any stock?
Badrinath January 23, 2019 at 10:35 am
Hi Sir,
ReplyI entered at 15 with strike price of 2800 and exited at 60. i didn’t buy again.
PRAVEEN REDDY January 23, 2019 at 2:02 pm
Sir
ReplyI bought SBI 290 cenat 8.9 it goes 9.2 am not booking.today at 5 rupees plz tell me sir book loss or wait 1 or 2 days
Jay January 23, 2019 at 7:57 pm
Hi pramod ji,
Today at market close the price of idea increased and the 32pe also increased with huge volumes?
How do you see/read that?
Replyadmin January 23, 2019 at 8:24 pm
I wish I knew how to read such information. Whatever is to happen will happen notwithstanding what the option data says. Yesterday morning every expert was talking of Nifty 11000 level based on option data. Today the song is changed to 10800.
ReplyCheers.