Morning update at 8 am 19 aug 09

As expected dow showed the upward corrective bounce of 82 points on tuesday before another big fall in coming days. But before the next big fall, there may be a day or two of confusing flat in dow. Following the dead cat bounce in us markets, european markets were up by nearly 1% with uk ftse up by .9%. Brazil up by 1%. Asian markets after a mild rise yesterday have opened mixed to +ve & may remain +ve initially to follow dow futures later in the day.

For indian markets, expect a flat to milder opening in line with asian markets. The trading range may be confined within 4480 to 4490 on the higher side and 4400 to 4375 on the lower side. A decisive breach above 4480 initially and then 4494, can take nifty to higher levels and on the down side most likely 4400 level will be protected if nse index maintains above 4424.in that case there is a possibility of a range bound flat to mildly bullish day..

With only 6 trading days before the expiry, option buyers should be extremely careful in order to avoid seeing their option value reaching 0 value by expiry. Avoid carry over of bought options, if things go wrong the option will lose value in a big way. Write (short) higher calls of 4600 on market rise and write 4200 puts on market declines and hold these shorted calls and shorted puts in case one has bought lower calls of 4500 and bought higher puts of 4400 or 4300.