(Posted at 22 :30 on July 02, 2018. )
We are on to the Day 03 in July Series.
After the 125 point NIFTY rally on Friday, Monday was the day to give back some of the gains.
But this 57 point fall does not tell the complete story.
At one time, NIFTY was down about 100 points. All our 5 trades were doing fine ( though PNB was still losing ) when suddenly there was a sharp surge in banking stocks. The rise was real fast and abrupt specially in PNB.
Let us first have a look at NIFTY for the day.
And this was the move in PNB.
It really put our PUT 70 in a bad position.
We are not here to win every trade. The aim is to make a selection, select an appropriate strike which does not have a heavy price and has a chance of coming good.
One such trade was selected today. RELCAPITAL 360 PUT.
The suggested price was Rs. 7.80 which was feasible as the low of the day was Rs. 7.50.
It ended the day at Rs. 16.00.
The price movement is here:
It made good the loss in PNB to a considerable extent.
ICICIBANK also did not do well but BHARTI did well. It was the biggest loser among NIFTY stocks.
Overall we are in a better position than previous day if the trade in RELCAPITAL was taken.
The position at the end of day looks like this:
A slight profit is welcome . Let us hope that it becomes bigger.
Any New Trades ? :
A lot of stocks are showing weakness. A reader has pointed out that we are having PUT options only, what would happen if the market turns around.
My experience has been that weak stocks remain weak even when rest of the market is strong. But it takes just a moment to go wrong like we have seen today in case of all three of our banking selections.
For today we stay with the same 5 trades. No additions suggested.
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.
Krishna July 3, 2018 at 6:54 am
What do you think of Bajaj Finance? 2500 CE seems interesting. Do you think its up trend is intact or is it over?Reply
Venkat July 3, 2018 at 9:25 am
Liquidity is very less in Bajaj Finance Options..Reply
admin July 3, 2018 at 3:40 pm
At least trend was sustained today. Volumes are also fine. Only problem is that it has not been in my watch list so I am not familiar with the moves. And the Calls are having high premiums.Make a thoughtful choice.
Shankar July 3, 2018 at 3:14 pm
How about VEDL? Seems like it is going down?Reply
admin July 3, 2018 at 3:36 pm
Good home work done. VEDL meets the criteria of a declining stock. It is trading now just 4% away from its 52 week low. It could not sustain the highs on a positive day. On a negative day it should go below the previous low of Rs. 221.60 made on June 19, 2018.