Late Late Morning Trading Strategies – India July 10, 2012

Good Afternoon again. The Rupee has corrected to 55.9 levels in the July fuitures where it is likely to go on till 55.5 till today probably as it tends to move on the trot towards an equilibrium price in 54.x after having beein oversold again for 4 days onthe trot

Yes Bank is still moving up, IDFC a good buy at these levels ; Powergrid, REC and PFC looking like good buys, Indusind showing signs of peaking while ICICIBANK seems to havebecome the ticket for Merill Lynch in this rally with the brokerage vie to 1200 looking well thought and well timed

SBIN has moved up well and is unlikely to stop till 2350 ( see yourmoneysite.com/profiles/80652)

Nifty Calls and Sold Puts offer a good enough window as doe Bank Nifty sold options. However some shorts may still be on th elook out of a fresh position on the Banknifty at these levels so the market is not in a hurry to score 5500 or even 6000 as targets have hit the rope on those marks due to the long favorable consolidation

Fundamentally new stories: Coal india and IGL both coming out of sectors that have tackled specific problems and are going oto be the success stories in PSEs and retail energy distribution, exotics almost inthe Indian polity and GDP fabric that ties to 5-6% range come what may. 

NBFC story Sriram Transport is catching up and those tired of SKS Micro may wonder at will inthis never go down stock butswitch from cash only after markets complete a down move. 

Buy a Spread (buy ATM(target) and sell OTM CALLS -5600/11200 capped by funding recd) and see it develop. or go vertical and sell ATM(target) and sell OTM CALLS – 5600/11300 donside limited by net investment

Also keep onn the look out for a higher index level before investing in puts

the sell spread might work better for you by selling puts…

e.g. Sell 5500 Puts on Nifty (4) and Buy 5600 Puts (4) out of the premium for supporting your bought calls

OR

      Sell 5600 Puts and Buy 5500 Puts with it to stay safe in the cap

simlarily using banknifty 10800/11000 or 11200/11300

 

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