Sell the rally. Wait for the base. Long gamma day

Today is the day they get paid for. Then the weekend happened. Saturday, Trump rejected another Iran ceasefire round. By Sunday afternoon, Brent had touched almost $113 a barrel. That is $4 above we closed on Friday. WTI sits at around $107 right now. Brent at 113 means that Indian companies are going to pay more for every barrel they import. The rupee weakens because India spends more dollars out to pay for that oil. The rupee already has touched 96 against the dollar on Friday for the first time in record.

Across the Pacific, Wall Street had a bad Friday too. 24% in one session. 54%. Both indices at all-time highs on Thursday evening. The Trump-Xi summit produced no deal. Tech stocks bled on Friday's close. Over the weekend, Bitcoin also slid $1,300 to $78,000. Ethereum cracked to $2,177, the 10-month low that we are seeing. The picture is unchanged in one sentence. Risk is leaking out of every asset that ran up in April. 62%. We opened around 80 points below where we closed on Friday.

But here's the question that decides today's trade. The market opens at 23,561, above 60 points above 23,500 mark. 4 million put contracts for this week expiry. That is the biggest single position on the entire chain. Just to put it in perspective, a lot of people have paid a lot of money to be protected if the market falls to 23,500. If the market goes there today, the sellers of those puts have to defend that level. Sometimes that defense works, sometimes it breaks.

That is the question number one. Does 23,500 hold in the first hour or does it crack in the first hour? Now tomorrow, Tuesday is Nifty's weekly expiry. On expiry day, the market usually drifts to the level where most option sellers walk away with the money. That level for this week is at 23,700. So today the market opens at 23,560 with 23,500 below it as a defended level and 23,700 above it as the magnet for tomorrow's close. That gives us a corridor of 23,500 to 700, a 200 point width that we are going to see.

Today's move inside that corridor or does it break it? 01. 5. The option market expanded and 18% increase will happen in share trading that is vol expansion pros have paid for today. Today is not sit and wait day. Today is a movement day. So the plan for today, three steps in order, simply follow these. Step one, do not chase the opening dip. The market opens 80 points into red. Let it test 23,500. If 23,500 holds in the first 30 minutes, a bounce will come back towards that 23,600-700 zone.

That is the magnet of the chain. Step 2, sell the bounce when it comes to 650-700 levels. Do not buy into the strength. The chain wants 23,700 by tomorrow afternoon but pro has paid for the movement on the way there. Sell the rally and wait for the second leg down. Step 3, wait for the base to form. It will print somewhere between 23,400 to 500 depending on whether we crack 23,500 easily. Once that base holds for 15 to 20 minutes on a closing basis, go long.

Target the same 23,700, that is what we are playing for. That is where Tuesday we want the close to be. Stop loss is tight under the base. If 23,500 breaks and stays broken, the next level down is deep. That is 23,000. Watch for it. That is a 500-point air pocket. A simpler version for smaller accounts is buy a 23,500 put and buy a 23,800 call. That is a strangle. The total cost is roughly 190 rupees. If the market goes below 23,300, the put pays handsomely.

If the market goes around 24,000, the call pays up. If both happens today, both pay. That structure costs less than the price of a single share of most Nifty constituents. Do not sell options today in the first half. The desks that paid for the movement on Friday are sitting on the other side of every option seller this morning. Time value will bleed slower than the price moves. The sellers will lose first. Look where the money is hiding. 34% on Friday despite the broader sell-off.

25%. 4%. 98%. Defensive sectors are moving up. Companies that earn even when the macro stays ugly, that is where the money is going in. Look where the money is leaving. 8%, on RBI broker rules plus higher bond yields. 8%. 93% because China's sentiment turned negative over the weekend. 67%. Higher Brent compresses their refining margin if they cannot pass on the cost to pump it. Stay with the defensives this week guys. Stay away from rate sensitive names. Do not buy the dip in the metal until China sentiment turns positive.

One catalyst for today will be IOC. Reports its annual results post close. Watch the close how the stock reacts at opening. Refining margin commentary will tell us for the rest of the OMC pack as well. One product launch today. NSE starts EGR receipts on day 1. Watch the volume. If retail picks it up, MCX silver and gold open interest will reshape over the next 2 weeks. One last data point until we wrap up. On Friday, foreign investors bought 1,330 crore of Indian shares in cash market.

After 5 sessions of selling, that was the first positive print. Domestic mutual funds sold around 1,959 crores in the same session. The domestic side took some profit while foreigners covered the short positions. Year to date, the domestic mutual fund flow has overtaken the FII outflow for the first time this year. That is a structural backstop holding the market up while the Brent and the rupee fight on the surface. RupeeCase Nifty absorbs these kind of weeks. The portfolio holds through pro movements.

com. Today is what pro paid for on Friday. Do not chase the open. Sell the bounce. Wait for the base. Go long for the moves towards that 23,700. That is the pin we are expecting for tomorrow's expiry. The chain wants to settle at 23,700. Help it or see it. Watch and see it getting break. This was the Tanmay Edge guys. If it added any value, share it with one trader friend who needs it right now. 30am in the morning. com. Also on Apple Podcast, Spotify, Amazon Music, YouTube as well.

Like, subscribe and share to your friends. We'll be back tomorrow with my expiry date. Have a happy trading Monday guys and a safe expiry as well.