A very good morning and welcome to Trade Setup with Tanmay — your 5-minute audio podcast before the chaos begins.

As of this morning, GIFT Nifty is trading at 24,924, up nearly 270 points, indicating a positive start to the week.

Key Market Drivers

• GST Reform Impact: The recent next-gen reforms in GST, with tax rate changes, could influence individual stocks and entire sectors. This will be the key theme to watch.
• Global Cues:
  • Nikkei: +361 pts (43,740)
  • Taiwan: +86 pts (0.36%)
  • Shanghai: +0.58%
  • On the weaker side: Kospi (-1.2%), Strait (-0.66%), Jakarta (-0.4%)→ Overall, Asia is trading mixed.

  Commodities & Currency:

  • Crude: 65.77 (pulling back)
  • Gold: steady
  • Dollar Index: 97.89 (below 98)
  • USDINR: 87.55, testing resistance near 87.80

  Flows

• FIIs: Net sellers of ₹1,926 crore (as of 14th August)
  • August net outflow: ₹24,191 crore

  DIIs: Net buyers of ₹3,895 crore

  • August net inflow: ₹55,795 crore

  Sectors & Indices

• Positive strength: Auto, Pharma, IT, Infra
• Weakness: Realty, Metals, FMCG
• Indices: Nifty, Bank Nifty, Sensex all in long mode on TK ALGO combined signals.

Volatility & Options Setup

• Thursday’s close triggered a long IV signal on TK ALGO at 10.1 IV → still stable at the same level.
• Expectation: Large jump in vols today.
• Synthetic futures (21st Aug expiry): 24,653 → about 250 pts lower than this morning’s open.
• 24,650 straddle: ~₹282, implying range 24,920–24,940 (near current open).
• Likely first-half consolidation → pullback → second-half trending rally possible.

Strategy Setup:

• Continue with long gamma bias.
• Trade via short calendar: Buy near-dated straddle, sell far-dated straddle.
• Avoid naked long vols; pair with calendar to reduce bleed.

Derivatives Positioning

Clients:

• Net long 5.62 lakh shares (options)
  • Calls bought: 1.7 lakh
  • Puts sold: 3.9 lakh

  Futures long: 1.24 lakh

  → Clients are heavily long; advisable to book partial profits on the open, re-enter on dips.

Pros:

• Net short 2.34 lakh contracts
  • Calls sold: 1.45 lakh
  • Puts bought: 90k→ Likely to be hit on the positive open, could add to second-half volatility.

  Game Plan for Today

• Expect consolidation in the first half, but bias remains positive.
• Profit booking on the open makes sense; re-enter on pullbacks.
• Keep eyes on 24,800–24,850 support zone and 25,200 upside target.
• Long gamma strategies remain favored as realized moves > implied vols.