Max pain says up. Gamma says down.

Very good morning guys. Monday opened 106 points higher. The gap from Friday's closing auction, the one the screen never showed right, closed in the first hour of trade. Nifty had hit 23,734 by 9:20, which was Friday's real fair value, the number the MSCI rebalancing was hiding. The dislocation paid itself. Then the market sold every single hour, all day long, from open high straight into the close of 23,382. Was 10 stocks up, 40 down. VIX rose. The snapback told you the truth about Friday.

The day itself told you the truth about Monday. Both stories were the same: there is selling above 23,700 and it is real. So you are listening to the Tanmay Edge. This is episode 51. I am Tanmay Kurtkoti. Let's go. Now here is what Tuesday morning looks like. Today is expiry day. Overnight something shifted drastically. The crude spike that looked like the dominant story over the last week, Brent had hit $97, had partially reversed. We saw a sell-off on cryptos as well.

And there is chatter about the war talk again spiking up. 36, down about $3 from where it was yesterday night. That is the real softening. The RBI meeting is this week where crude is a direct input in how much room they have on the rates. The overnight pullback is the most positive thing India could have hoped for. But Asia is doing its own thing today morning. GIFT Nifty came in at 23,234, down almost 200 points. 9% gap down from Monday's close.

75%. 65%. Asia is not following the crude softening relief story. It is running its own correction. 26%. So the US tech bid that drove IT here yesterday is still alive. Dow futures are still slightly red. So no clean directional read from global markets and India trades its own expiry story today. The open is likely somewhere around 23,175 to 23,230. And here is why where we open matters that much. The 1SD range for this expiry, the full width of the day's move the options chain has priced, is 23,145 on the lower end and 23,620 on the higher end.

We are opening at the lower end of that range. And the biggest concentration of options positions for this weekly expiry, the natural magnet, sits at 23,500. That is 270 points above where we are going to start. This is the setup I want to explain today because it is the cleanest expiry lesson this season has produced. When most people hear that option writers are protecting 23,500, that is the price where most buyers lose, they expect the market to just drift up towards it on expiry day.

That pull is real. But whether it actually works depends on something most traders do not know about. A switch level in the option structure. Around 23,450 to 23,500 on today's chain, the way market maker hedging works changes direction. Above this level, hedging tends to slow moves down and pull the price towards the magnet. Market is calmer, it drifts. Below this level, we are opening at 23,230, that same hedging reverses. Instead of dampening moves, it amplifies them. A market that cannot reclaim 23,450 in the first hour is a market where every 100-point move happens faster than you expect.

This is why opening below the switch level on expiry day is different from opening below it on a regular day. The magnet exists. It can still pull up. But it has to fight the amplification every step on the way. And then the clients are holding a huge amount of short puts that could get stretched out in the first hour. Watch for those stop losses getting triggered. And that 23,200 to 23,145 level is what we are looking for. That is the tug of war today.

Max pain says 23,500. The structure says: first reclaim 23,200. So 23,200 is where the real cluster of put positions sits. It is the hard floor in today's chain. Price opens right at it. What happens in the first 20 minutes tells you the shape of the day. If price opens around 23,175 to 23,230 and 23,200 holds, buyers will start to step in. Bounce will start in. And VIX is the main criteria for today. If VIX stays elevated then there is a high likelihood of 23,000 hitting on today's expiry as well.

But if the VIX starts to cool down and 23,200 holds, then you have the foundation. Nasdaq is up this morning. IT showed up yesterday. So if TECHM and Infy come in green again they lift the index even when everything else is flat or negative. Watch for domestic institutional buying happening after 10 AM as well. That is where DII programs typically land on large gap downs and they will start buying in. The bounce target is 23,300 to 23,350. 150 to 200 points can be expected in the morning session.

If that holds and IT runs, 23,450 by afternoon becomes real. From 23,450 the switch becomes in play and 23,500 is just 50 points away. Reclaim that and the magnet at 23,500 starts pulling for real. If 23,200 breaks in the first 15 minutes and pushes through, we are watching for that 23,145 level as the signal as well. You are in the fast lane below the switch. That is the 23,400 level below which the market is in negative gamma territory. The 1SD lower bound is being touched.

Do not try to catch the falling expiry in this regime. Do not sell premiums if the volatility is rising. The move lower will be faster than your hedge. Step aside and wait for stabilization. One more variable guys. 36 this morning crude is much better than yesterday. But the tension that caused the spike is not gone. A fresh headline resending Brent above 97 is your circuit breaker for any bounce. Watch crude this morning along with equities. If crude holds flat or softens further the bounce setup has some chances.

If it re-accelerates the DII bid gets tested harder. Whatever happens at 15:30, do not carry positions into Wednesday. RBI announces the repo. You have had an expiry day, a crude overhang, and a gap-down morning all stacked before the rate decision. Wednesday opens on a completely different basis. Let today settle. So today any directional position you trade, trade it with a spread. Use a hedge at least at 23,000 if you are going long and 23,500 if you are going short. That is the hedge that needs to be in.

That was the Tanmay Edge for Tuesday guys. Episode 51, weekly expiry. The picture this morning is GIFT Nifty at 23,200, Asia under pressure, crude softened to 94 from last night's spike. Opening near the lower edge of the range the chain priced for the day, 23,145 to 23,620 on the upside. Either way do not carry any positions for tomorrow. Take your hedges in place. Check for volatility for a breach above that 17 mark. If the volatility rises above 17, stay sideways. Do not enter into a high volatile expiry.

If today's breakdown helped you see the expiry clearly, share it with one trader friend who also needs those expiry lessons, it takes less than 10 seconds. Subscribe on Apple Podcasts or Spotify so you don't miss the next breakdown. com, India's first investing terminal. If this episode delivered value guys leave a rating on Apple Podcasts or Spotify. Five stars if you mean it. See you on Wednesday. Till then have a very happy expiry and trade safe.