27/01/2025
Indications from Economic Factors
If USDCNY continuously trades below 7.3, it will be very difficult for RBI to keep USDINR below 84 mark. It is inducing huge trade deficit with China. China is constantly devaluing its currency.
Put IVs increased more than Call in last few days – indicating Put buying.
Absence of fresh foreign big money in large caps.
Continuous printing of currencies in major economies creating more inflation in global market.
Absence of strong financial policies controlling impending trade deficit.
Too much demand of commodity, means money flowing out of capital market.
USA has inverted yield curve. Historically it shows, inverted yield curve precedes economic slowdown or recession.
India has flat yield curve which contextually shows economic uncertainty and flattish interest rates.
Indications from Derivatives
OI to Vol ratio on call side is getting weaker suggesting only retail participation.
Long straddle premiums getting small, suggesting volatility squeeze with predicted volatility expansion.
Overall derivative leaps IV data is bearish with more focus of OTM calls.
Long puts are getting created in indices with no major future longs.
Max stocks trading near 200dma and Up-Move has already covered 2.6 standard deviation.