Crude cracked. Asia ripped. Today we buy the dip

A very good morning guys. m. in the morning looking at the screen and I'm going to be honest with you. I did not expect this. Yesterday when the markets closed Brent was at 109. 73. That is a 5% crack in four hours. 27. Then I opened my laptop this morning and KOSPI is up by almost 7%. 55%. 38%. Asia is completely ripping. This is The Tanmay Edge. You're listening to Tanmay Kurtkoti, Season 2, Episode 44. Let's go. I want to start with what happened Wednesday.

Because if you missed it, you're going to misread it today. Nifty closed at 23,659. Sensex closed at 75,388. Both green by a quarter percent. Boring on the surface level, but under the surface something loud happened. The professional desks on the option chain did something they have not done all the season. They flipped from being short 21,902 call contracts on Tuesday to being long 1,33,782 call contracts on Wednesday in one session. That is a swing of 1,55,000 contracts, which is fancy way of saying the smartest seat in the room reversed direction overnight and bet the move was coming in.

And then the move came. Crude crashed 5% in the evening session. 89%. 54%. The European markets closed higher. 58, which means the bond market is also saying the pressure is releasing. Every chart on my screen this morning is green except for one and we will come to that as well. And about GIFT Nifty. GIFT Nifty is trading around 23,807. That is up by 142 points from yesterday's Nifty close, which means we are opening around 23,800 today. And if you are watching this morning the question is not whether we open green or not.

We are opening green. The question is what do we do with the green. So here is what I am thinking. For the last three weeks I have been telling you the same story. The professional desk has been hedged. They have been buying puts. They have been holding futures long. They have been positioned for the moment on both directions. That is what we call long gamma or buying options or long IV. They paid for the moment. They did not pick a direction.

They paid for the move. And the move also came in. Wednesday they finally picked. They added 2800 long futures contracts and they reversed 1 lakh 55,000 contracts on calls. They paid for upside and the upside came overnight in the form of Brent crashing and Asia markets ripping in. This is the third time this season we have seen this exact sequence. Episode 25. Episode 32. And now Episode 44. Each time the professional desks flipped to long calls on Wednesday and the market gave them the move within 36 hours.

The first two times we faded the move. We sold the rally into the resistance or the wall. This time I am not fading it. I am buying the dip. And why I am changing the play. Three reasons. Number one. Brent at 105 is not just a number. That is an escalation lane releasing. For the last two weeks every dip in the market was bought by traders pricing in the chance that crude will bounce back to 115 to 120 dollars. That bid just lost its anchor.

If you are short, you are now defending without the macro tail behind you. Number two. The 10 year yields. 10. 09. 84. UK dropped to below 5. These are big single day moves. When bond yields drop globally on the same day equity gets a tailwind. Cheaper money chases equities first. And number 3. 8%. Let me say that again. 8%. South Korea is a leading indicator for global tech sentiment because Samsung and SK Hynix sits there. 54% the same day, you are looking at a synchronized risk on signal.

Indian IT does not lead this kind of move. Indian IT follows it. Now today is Sensex weekly expiry which makes the trade more tactical. Here is what I am watching for. If Sensex opens around 75,900 and supports 75,800 in the first 30 minutes, the writers who got caught in short calls on Wednesday are going to defend it and do some covering up to 76200, and the magnet for today shifts to 75,900 to 76,000. That is the writer's pin. Selling premium near 75,900 if you are an option trader and exit by afternoon.

Do not hold into the close. The maths gets messy in the last closing hours. If Sensex opens up around 75,900 and slips backs to 75,500 in the first hour, the gift gets taken. The 75,500 level becomes the support and 24,000 on Nifty becomes the next thing on the right side of the chart. That is the dip you buy. Not the open. The dip. Remember this. And if you are not trading options, if you are just watching cash, same idea. Wait for the dip.

Do not chase the gap up. The gap up is the entry for institutions which already took it. Your entry is the pullback you are looking for. Now I said one thing on my screen is red. That is gold on MCX. 7% for the week. And there's a reason. The government raised the gold import duty to 15% on Tuesday night. Kalyan stock dropped 6%, silver dropped 7%. The whole jewelry basket is recalibrating. Watch the gold names today as well. If you own jewelry stocks, you are sitting in a duty trap.

If you are a buyer, this is the moment to see if 1,58,000 holds on gold, if we get a flush down. The one thing that bothers me is USD INR. 82 yesterday. That is just below the record. It did not weaken further overnight but it did not strengthen either. If Brent stays at 105 the rupee should strengthen this week. If it does not strengthen by Monday we have a problem because that means the dollar bid is structurally not just oil driven.

Cash flows from yesterday show that the foreign desk sold 1597 crores. Domestic mutual funds bought almost 1963 crores. That is the third session in a row where domestics absorb foreign selling completely. The pattern is intact. Domestic flows are the support under this market right now and they have been there for weeks, months and years now. So the read this morning is straightforward. Pro desk flipped bullish on Wednesday. Overnight tape has paid them off. Today is expiry day with the gap up open.

Buy the dip, not the open. The dip. Watch for 75,500 to 75,600 on Sensex and 23,600 to 23,700 on Nifty for the level the buyers come back at. About 23,900 we have clean run at 24,000 by next week. Below 23,700 today we wait. And before I sign off two reminders guys. Number one. We are still six sessions into the pattern where direction has been right and levels have been tight. Yesterday was the first time direction and levels both lined up. Four out of five strict predictions hit in.

The one that missed was Bank Nifty reclaiming 53500, which it did on the rally. So the read being graded honestly. Number two. com. The day six alpha number prints today. So have a happy trading expiry guys. Buy the dip, not the open. This was The Tanmay Edge. See you all once again tomorrow.