1. In october series, I am totally shocked to see very little OI at 6100CE and 5900PE. Just take a look at first day of SEP series table below. On 27th Aug, we had 89L 5400PEs and 63L 5500CEs and Nifty was trading closer to 5500.
3. I agree that call writers have gone through a tough September but what's wrong with put writers? I would have at least expected 5900PEs to be 70L on the first day of series that gained 10%. Need to see if things change in first few days of series.
4. PCR has reduced to 1.27 after reaching monstrous heights.
Nifty futures:
2.78Cr OI up 23% (55L shares added to OI) - Now the OI is down from 4Cr+ in the middle of SEP series. Looks like weak shorts are out.
Banknifty Futures:
17L OI up 35% (4.5L shares added) - This OI is almost 40% down from its peak during middle of SEP series. Shorts are gone and if longs don't get added here, then we might see a fast correction in Banknifty.
To me SBI @3200, HDFCBANK @2500 and ICICIBANK @1130 are already stocks that have gained so much that a 3-5% correction would make the market healthier than total vertical ramp up.
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6 comments:
Values for October future:
VAH- POC- VAL
6044-6038-6008----Nifty
12370-12350-12241----BankNifty
GD,
thanks for the post.
Somehow, I am not able to understand the option thing.
- If I am sure that market will touch 5900 in let us say 1 month - what should I do? Can I buy an option? what is it called? a CE or PE?
- What are the prices? for eg if I have to buy a CE for the above possibility - what is the price? take any hypothetical price say 20 rs. 100 rs etc.
- if actually market goes to 5900/5850/5950 - how can i exercise the option?
sorry i m bothering you - pl. do write if you feel like.
Also - a few lines on the possibilities of Monday NF/BN going up/down will be a good read - i know it will be a speculation - but it should make good read based on your study of options/global markets.....
- I have taken a short in MININIF. at 6171 - pure speculative one.....
http://www.marketwatch.com/story/sec-cftc-blame-algorithm-for-flash-crash-2010-10-01
'Flash crash' report tells what we knew all along..
shai, viren,
you are also requested to shed some light on my query above so that this mental block reg. the options trading is broken for me.....damn! if i can trade the most dangerous future JISJALEQS and manage to scalp few points.....why can't i trade options http://us.i1.yimg.com/us.yimg.com/i/mesg/emoticons7/22.gif
Janak,
Options trading is not that complicated.
Following link gives basics of options trading:
http://www.investopedia.com/university/options/
For your query abt u wanting to speculate that 5900 is coming, you buy a 5900PE.
There are few things you might want to understand:
1. There are two components in any option price - time value & intrinsic value
2. At beginning of month the price of 5900PE is high because of time premium (value).
3. If market goes the other way - like it happened yesterday - your 5900PE will lose value and it will lose value drastically.
4. If the market falls from 6150 to 5900 your option price increases fast, but if expiry happens at or above 5900 you lose all the money you put in.
For your second question:
I think Shai already gives some analysis of what direction the market can take in the last hour of audio session. More than the speculation of direction, what I try to get from Shai is analysis/conclusion like "Is the profile balanced and can it extend further staying above level 'ABC' or are we getting concerned about a P-shape profile in which case the market may be stagnating.
I will make a confession here - Two weeks back when Banknifty made a new nigh @11350+ I had taken 1 lot short on Friday afternoon. And Shai was explaining that the "P-shape is negated and we could have an extension of this market". I ignored his words and carried the short over the weekend. And guess what happened on Monday "200+ point gap up"!
So I listen extremely carefully to every word that Shai says especially in the last session looking at the bigger picture. After going home I have also started studying the profiles and trying to apply the same thought process to different stocks. That's the only reason, I am able to take a call on stocks.
So I would say that you put some effort at EOD to study the index/stocks that you want to trade, ask questions next day and get the thinking process right. Then looking at charts you can make the judgement of which way the market can go without anybody's giving you a view for coming day.
thanks girish, that was a very good explanation - i will keep reading it till it becomes more and more clear.
I have a spirit of a GAMBLER - and i m trying to work on it - but so far in my life, i have always gone for things which have maximum risk - and it is not always for money......
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