Friday, 22nd August — GIFT Nifty trades at 25,057, down 50 points, even as Asian markets hold steady in the green. US indices slipped overnight, with the Nasdaq down 0.34% at a crucial 21,000 level.

Flows turned supportive, with FIIs buying ₹1,246 crore and DIIs adding ₹2,546 crore. For the month, however, FIIs remain net sellers (-₹24,128 crore), while DIIs continue to absorb supply (+₹66,512 crore).

Positioning data shows clients maintaining their long stance with 4.43 lakh shares net long, while pros remain net short at 1.21 lakh shares, balancing the risk. With implied volatility at just 8.5 for the August expiry and realized volatility still running higher, long gamma strategies remain the preferred play.

Trade Setup:

• Core directional bias: Stay long gamma.
• Bull Put Spread is attractive: Sell 25,500 PE, Buy 25,100 PE. The spread is trading near 320–330 points, with risk and reward both capped near 40-50 & 350 points.
• Pharma continues to show sectoral strength, while CPSE remains a weak spot.

In commodities, gold trades near ₹99,390 with a slight bullish bias, silver is stable, crude has bounced to ₹5,545, and natural gas shorts should be covered at ₹240. Bitcoin remains weak at $1,13,440, while the Dollar Index stays firm above 98 and USDINR holds at 87.26.

With vols suppressed but realised moves still sharp, the theme remains the same trade with long gamma, use spreads to define risk, and focus on sectoral outperformance.