NIFTY keeps on moving up. Another day gone and few more points added.
The 35 point gain did not come in a simple manner. It was a journey towards a high and then moved to negative zone. It stayed in the red for a while before moving up in the last 30 minutes of trading.
The chart below tells the story.
The steep up move in the last part of day came because of RELIANCE. We know that RELIANCE has got a very significant weight in the Index and a move there impacts NIFTY move. See the similarity:
Whether other heavy weights join the rally or not will decide further moves. For yesterday, INFY and TCS did not participate in the up moves. These stocks in fact lost some ground and were able to keep NIFTY move in check.
HEROMOTOCO was again down for the day and so was INFY for our trades. Other stocks did not contribute at all to our trades and we remain where we were on Friday. No gains made and nothing much lost.
With 7 days remaining to expiry we need some quick moves in the direction we want.
New Trades :
We saw the momentum of RELIANCE yesterday. It is not a very big gainer over last 30 days. NIFTY gained 6.19% while RELIANCE has gained 8.87%. But right now it is very near to the 52 week high of Rs. 1362 which may be topped very soon. Last month NIFTY had gained on the back of lesser lights, for a significant up move now the heavy weights have to participating in the move. RELIANCE looks to be in prime position to do so.
IV ( Implied Volatility ) is usually not very high for this stock but it is above 25 so we are okay with that.
RELIANCE CALL 1380 @ Rs. 16-17 would be my choice for a trade.
Lot Size 500, Maximum Risk Rs. 8500.
ICICIBANK made a new 52 week high yesterday.
That is an automatic qualification for buying a CALL option if we are so inclined.
With the momentum in favor we go for a low risk trade. ICICIBANK CALL 420 @ Rs. 1.40- 1.70 would be my second trade of the day. Lot Size 2750 and maximum risk Rs. 4675.
Now for another PUT trade.
MARUTI just about meets the parameters for buying a PUT. It is down over both the 30 day and 7 day period. With weakness seen in automobile sector, we go for this trade.
MARUTI PUT 6700 @ Rs. 65-75 is a PUT selection for the day. Lot Size 75, maximum risk Rs. 5625.
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.
Raveendran K A March 19, 2019 at 9:19 am
Reliance 1380 call is a good choice … will do wonders for this month’s trading portfolio. Let’s hope for the best.Reply
admin March 19, 2019 at 9:56 am
The beauty of the market is that it gives hope at all times. At times, hopes are fulfilled, other times they are dashed. No one knows which trade will go right and when. Same for Reliance 1380 Call. It can do wonders or we may be wondering what happened to it.
Let us wait and watch.
vishal agarwal March 19, 2019 at 9:32 am
Took all the 3 tradesReply
Reliance @ 16.5
Maruti @ 75
IciciBank @ 1.3
Hope for the best!
arnab March 19, 2019 at 10:40 am
I think Nifty faces strong resistance at 11511, which is why i purchased nifty put @11525 or so yesterday, closed it intraday as nifty moving upwards again, but I feel, the top is capped…don’t think there is much upwards move left there, I purchased a bharatforge 500pe @4.7…lets seeReply
vishal agarwal March 19, 2019 at 2:11 pm
We already have truckloads of Puts with us. A few bullish positions are just to entice the bears. Small loss for big gains you see 😉Reply
vishal agarwal March 19, 2019 at 4:40 pm
After many days booked quick gains in Reliance trade at 26.5.Reply