Pre-Market Report, December 09, 2020

 Is there one more leg of rally left?

HDFC Bank, Kotak Bank, Reliance will decide.

Pre-Market Report :

1. US markets closed in Green.
2. Asian markets are higher.
3. SGX Nifty is above 13450.
4. Earlier I said, markets are higher despite HDFC Bank, Kotak Bank, Reliance are down.
5. Yesterday Reliance moved higher and that supported the market.
6. Markets were flat yesterday but PSU Bank Index up 7%.
7. Some PSU Banks are up more than 15%.
8. If Reliance, HDFC Bank, and Kotak Bank perform, we can expect one more leg for this rally.
9. But FIIs seem to be unwinding their long positions.
10. FIIs were 82% long a few days before, now 75% long.
11. Even 75% long is a strong figure.
12. Nifty future shed some premium due to this long unwinding.
13. In the very short term, markets are likely to consolidate.
14. Going by Option prices, Nifty is likely to consolidate between 13250 and 13550.
15. Huge OI added at 13400PE but among Calls, huge OI added at 13700.
16. I have sold 13300PE yesterday around Rs 50, hoping that it will go to zero.
17. What is surprising is that India VIX is not coming down.
18. FIIs as usual bought heavily for Rs 2909 crores.
19. DIIs are equally aggressively selling.
20. But only intraday fall comes, no positional loss.
21. Must watch HDFC Bank, there seem to short in that.
22. If there is any short-covering, Bank Nifty can touch 32K.
23. Taking a bullish view, I sold Bank Nifty Put Options at 29000, 28000, 27000.
24. Even in weekly Options, I sold 29500PE.
25. Nasdaq is up for the 10th straight day.
26. Global cues are so strong, we are likely to open at yesterday's high.
27. Time to be Cautious on the upside when everything looks good.
28. However, on every intraday dip, I am selling Nifty 13000PE.
29. Even if markets correct, I do not expect the Nifty to fall below 13000.
30. Nifty future may trade between 13360 and 13520.