Will October's bears continue to dominate? Rahul Sharma answers
«Going by the monthly put options on the Nifty seems like a good idea where we feel that these put options can double or even possibly triple from the current levels,» says Rahul Sharma, JM Financial Services.
Third straight day of decline and today it is around 200 points down, that is what we are looking at the benchmark. Where do you see support levels to come in for the Nifty?
Rahul Sharma: Clearly, this is another breakdown in the works and Nifty seems like the 24,700 low that we made on the 7th of October should be broken anytime soon. Well, the meaningful support is placed in the vicinity of 24,500, 25,400. So, another 300 to 400 points can be taken off from the current level. And we feel that there is still some time for the capitulation to happen.
So, at this point in time since October has been heavily dominated by the bears, we feel that over the next two weeks we could see another round of volatility coming in and 24,400 is where we are seeing the Nifty at this point in time. Now, as you could simply buy the 24,500 put options of the monthly expiry which are currently trading at 108, 110. This can act as a hedge against your long positions or even if you want to have a short exposure in the market. Going by the monthly put options on the Nifty seems like a good idea where we feel that these put options can double or even possibly triple from the current levels.
And how is the auto index and the auto stocks looking like? Obviously, there is a fundamental reason behind this fall, but how is the index
