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I felt like writing a normal daily note. Just to prove to myself that I can do it too. So here goes.
The Nifty continues to be in an uptrend. Our trend following system (OTS for short) will turn down only below 5040. Until then we remain long. The same OTS is long S&P, FTSE, Nikkei and Kospi while it is short HSI and HSCEI.
Among commodities, the OTS is short Crude, Gold and Silver while it is long Copper. The OTS is long on the Dollar too. Given the recent negative correlation of the Dollar with other commodities and equities, we might see a further fall in equities and commodities if the Dollar uptrend continues.
In India yesterday, we saw a rally in the Nifty till mid session. The fact that Abu Dhabi was willing to stand behind Dubai World aided sentiments. The Dollar index gave up some of its recent gains increasing the feel good factor in equities and commodities. Inflation numbers were released midsession and after the release of inflation numbers, the market took a hit and fell all the way down to 5100 levels. (Notice the clever statement"after the release of inflation numbers...." It states a fact and hints at causality while never actually claiming a cause and effect relationship between the release of inflation numbers and the fall in the Nifty). Telecom stocks were large losers and so were financials like ICICI Bank and HDFC Bank. Gainers included Cement Stocks and IT stocks.
So far so good. This is a typical morning note. No frills and no diversion into irrelevant topics. Maybe I should talk about some increase/decrease in open interests in some calls and puts. 5200 calls have the highest Open Interest and the largest increase in Open Interest too. Similarly 5000 puts have the highest open interest with the most increase too. This hints at the possibility that the market could remain range bound between 5000 and 5200 and any break beyond those levels could get accentuated by the option writers trying to hedge their delta.
This is good. Enough data has been given to satisfy every data lovers needs. And now to come back to the most relevant part. Our OTS has Nifty on a BUY and will go short only below 5040.
The Nifty continues to be in an uptrend. Our trend following system (OTS for short) will turn down only below 5040. Until then we remain long. The same OTS is long S&P, FTSE, Nikkei and Kospi while it is short HSI and HSCEI.
Among commodities, the OTS is short Crude, Gold and Silver while it is long Copper. The OTS is long on the Dollar too. Given the recent negative correlation of the Dollar with other commodities and equities, we might see a further fall in equities and commodities if the Dollar uptrend continues.
In India yesterday, we saw a rally in the Nifty till mid session. The fact that Abu Dhabi was willing to stand behind Dubai World aided sentiments. The Dollar index gave up some of its recent gains increasing the feel good factor in equities and commodities. Inflation numbers were released midsession and after the release of inflation numbers, the market took a hit and fell all the way down to 5100 levels. (Notice the clever statement"after the release of inflation numbers...." It states a fact and hints at causality while never actually claiming a cause and effect relationship between the release of inflation numbers and the fall in the Nifty). Telecom stocks were large losers and so were financials like ICICI Bank and HDFC Bank. Gainers included Cement Stocks and IT stocks.
So far so good. This is a typical morning note. No frills and no diversion into irrelevant topics. Maybe I should talk about some increase/decrease in open interests in some calls and puts. 5200 calls have the highest Open Interest and the largest increase in Open Interest too. Similarly 5000 puts have the highest open interest with the most increase too. This hints at the possibility that the market could remain range bound between 5000 and 5200 and any break beyond those levels could get accentuated by the option writers trying to hedge their delta.
This is good. Enough data has been given to satisfy every data lovers needs. And now to come back to the most relevant part. Our OTS has Nifty on a BUY and will go short only below 5040.
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