SHORT TERM TRADES

• In last Sunday's (17/11/2013) Blog Post SEE HERE,  I had opined that the NIFTY seemed to have turned from 5972 and was headed towards 6200, which is how it played out. Consequently we had good success with our Calls on DLF, BHEL, TATA MOTORS, CANARA BANK.
• However, Markets being what they are, just when all and sundry were looking towards 6350 as the next upmove, chose to turn from 6200; the FOMC Minutes being the apparent negative trigger.
• Now with the last closing ie on 22/11/2013 being at 5995 after an uncannily identical intraday low of 5972, the macro picture has again turned murky.
• The indices could remain sideways till expiry or indeed give a 150-200  point move either side. Hence it may be prudent to avoid fresh positions in the Cash Markets next week.
• However braveheart Options traders could either take naked PUTS or CALLS on high Beta such as JP ASSOCIATES, HDIL, IRB INFRA, ORIENTAL BANK to take advantage of breakout moves on either side. I am not a great fan of Writing (Selling Options, best left to pro Traders) and hence would not recommend the same for retail participants in F & O.
• A combination PE and CE at the same strike for the above high BETA could also work provided the breakout on either side is  a trending one and not a two-days down and two-days up kind of scenario.

JP ASSOCIATES:

1. BUY 1 LOT 47.5 PE AND 1 LOT 47.5 CE
2. TOTAL COST 2.6
3. TARGET 5
4. SL 1.5

HDIL:

1. BUY 1 LOT 45 PE AND 1 LOT 45 CE
2. TOTAL COST 2.25
3. TARGET 5
4. SL 1.5

Remember, the above will succeed only if there is a substantial breakdown or a breakout in the next couple of trading sessions, 30-40 NIFTY point moves on either side will not do; moreso, Expiry is only a few sessions away and OPTIONS will largely jive increasingly identical to intrinsic value only so keep your eyes peeled, be nimble and BOOK PROFITS at or as close to targets, do not linger on in greed.

ALL THE BEST AND HOPE FOR BETTER, TRENDING MARKETS NEXT MONTH SO THAT TRADING BECOMES FRUITFUL FOR ALL.