Market View 20230816

Over the weekend, everyone is talking about Michael Burry’s 1 Billion dollar short trade. If you don't know who he is, Dr Michael Burry (yes a medical doctor) got into trading, and an astute one who predicted the crash of 2008.

He was a bit early, but eventually made a boat load of money. There's a famous film about him called The Big Short.

The Big Short (2015) ⭐ 7.8 | Biography, Comedy, Drama

2h 10m | 6

IMDb

Really good movie, and worth watching.

If you haven't read the last few updates, know this, we were bearish for since the start of the month. A 10% correction from the peak would get us to 42000 on Banknifty. And now we have a VERY BIG GAP to close below... at 40000.

But in order to get there, we need to cross the 43,355 level. So far we've crossed the 21 moving average as well as 55 moving average, which is bearish in itself. But to cross the 42600 level i.e. 200 moving average is a VERY bearish sign.

And we can blame it all on that gap up in April.

10:42 AM

Let's look at the August series for option volume, to figure out where the players stand:

Looks like the straddles are forming around 44000, unlike earlier at 45000. That could be because we've seen a 1000 move down in just a few days. Range is from 43500 <> 45000, or 1500 range, or 700-800 either way.

And if we look at the September series, we get a similar picture:

I get the feeling that we could be going sideways for a good few months now.