Hedge 3800 put taken near 3900

RBI Hike
= interest rate sensitives to tank some more
banks,auto

most defensive=pharma/fmcg
pharma was pointed out few weeks ago near old bottom at 3570
and look at the stellar outperformance
The thing with markets is when the market starts going down, everything tanks
weekly 13ema trending down, reads 3850 or so
daily 13 ema was trending up : it read 3760 or so which gave us the fast bounce


If you took march put you had to book at 3760
If you took april put your target remains 3570
so you have 3 options
a) wait for 3570, book there, since that is 2x target
b) wait for 3570 , hedge there since you have mega profits to hedge
c) considering the fact that there is a very very remote bullish possibility of the initial rally supports 0.5/0.618 holding and much higher levels one can hedge
at the first support : 3700 region 0.618 retrace of initial rally.
Best bet = short 3600 put for 60+


Longer term vision.
A very large house is being built. Now in order to build a large house a large foundation is needed.
The ground floor for a bull market usually comes from a period of sideways consolidation.
We have already built 3 sides. the 4th is being built.
The top is not yet in place :). Thats the good news.
This is the bigger picture. Smaller picture if you remember the remote possibility of a flat correction in w4 position. But for that market has to continuously trade above 3656 for next few weeks.

sensex 4k-14k didn't happen overnight. The market came out of a multi year consolidation before it gave 200% gains.

The next 6 months will lay the foundation for sensex 20k
Short term volatility will continue retest of may 2006 panic lows is a remote bearish possibility.

The next big impulsive upmove in nifty might be when monetary policy easing starts.
First hint of easing and we will be off to the races again.

If you are a bull
Watch infosys 200 sma near 1970 or so.
a) infosys doesn't have huge interest costs
b) fundas are still up
c) results to come on 13th so its not out of the game yet.