Trade log NIFTY May 27

27 thg 5, 2020

In my yesterdays note, I had said

1. I had said , "Tuesdays price action should be taken as indicative of trend forward". I believe in that and till expiry, there could be down trend continuation.
2. I am not sure if 9000 will hold. 8970 - 8940 is key support region, if this fails, the bias is on short side.
3. Again 9150 - 8950 is the range we are looking at. I am not going to sell options around this range, as this is expiry week and there can be surprises. But trade will come when breakout of the range happens.

I was wrong on my Tuesday reading referred in point 1. Point 2 is invalidated for some time. For point 3, it helped me as I did not sold options overnight. And today NIFTY and BANK NIFTY created large move.

My trades today :

• First I closed my yesterdays trade of buying PUT option for loss, as there was no follow through for down movement.
  Then I made number of trades all for decent profit and as per plan. My profit was limited, because I had 9200 as target in mind and did not traded much after that.
  BANKNIFTY actually offered much clear opportunity on charts. I'll post that separately as it turned out very nicely.
  

My observations for the day :

1. NIFTY made big candle after consolidation.
2. Today is a day before monthly expiry.
3. BANKNIFTY outperformed and closed 7%+
4. INDIA VIX fell less than a percent.
5. Index breadth was positive, 41 to 9 but overall breadth was OK, 1059 to 712
6. NIFTY closed above 10,20,30 and 50 day simple moving average.

So overall clear trend day. The only suspicious things are
1) VIX did not fell heavily. That means, NIFTY has to consolidate to keep this gains and make it a new swing.
2) Timing of today's rally. Near expiry so, I wont go all in.

My reading
1) I''ll trade light tomorrow and see how we consolidate, what kind of range we form.
2) I'll wait till Friday, or may be Monday, to really changing strategy clearly on long side. But obviously now Bias is on long side as long as we are above 9000.