The close was a lie. The futures told the truth. Now it is expiry

A very good morning, guys. 6 percent, its best day in weeks. I am going to tell you that number is a mirage. The real market closed almost 190 points lower, near 24,586. Because yesterday was day one of the new single closing auction, and on the very first day it misfired. A phantom spike printed in the last 60 seconds that the futures never believed, the Sensex never showed, and the stocks themselves never traded at. Last episode I told you the first session under the new cash rule would be the noisiest, do not trust a strange close.

Well, here is the strangest close of the year. Today that ghost gets reset at the open. Our futures are pointing to a gap down to around 24,630, straight back to reality. And the reality is a pin, because today is a weekly expiry and the real market is sitting right on top of max pain, under the same resistance that has capped it for a month. So the real question today is not up or down, it is whether the auction misfires again at 3:30, on the one day it must not, expiry settlement.

And that is what today's episode is all about, guys. This is The Tanmay Edge. You are listening to episode 95. I am Tanmay Kurtkoti. Let's go. So let me prove it, because it decides every level you trade this week, and I will use only official numbers, four checks. One, the tape. The Nifty traded in a tight band around 24,580 the entire session. The whole one and a half percent appeared in a single vertical candle at the bell. The high of the day was the close.

Two, the futures. The Nifty future for today's expiry closed at 24,586, a full 188 points below that 24,774 spot print. One day before expiry a future cannot sit 188 points under the index unless the index is the one that is wrong. The future is the honest price, guys. 7 percent, and it made its high at the open, not at the closing bell. 6. And four, the clincher, the stocks themselves. 62. Add up every Nifty stock at its official closing price and the index lands near 24,580, not 24,774.

The headline does not match its own members. 83 percent, a good day, but an ordinary one wearing a fancy dress costume, is what happened yesterday. The real story was rotation. The sector that dragged all last week, technology, was yesterday's leader. The IT index jumped 3 percent, TCS and Infosys both up three and a half, as the money that chased the Bajaj twins on Friday rotated straight into the beaten-down software names. Bajaj Finance, Friday's 8 percent star, went flat. That is a healthy market, it rotates, it does not run on a single horse.

Breadth was strong, 44 of the Nifty 50 stocks higher. 98, its first uptick in days, as the tape itself smelled something odd in that closing price. So now the desks, and they quietly booked part of the bet. Friday the pros were long volatility, long both calls and puts into the event. Yesterday, on the move, they cashed some of it, they cut their long puts hard and kept the long calls, tilting one side instead of two. The FIIs did the constructive thing.

They kept covering, buying back another 22,000 short futures, and the tell, buying back 56,000 of the short calls, taking their foot off the very resistance they had been defending. They bought stocks again, 922 crore, alongside the domestic institutions who bought almost 1,571 crore in the cash market, the second straight day both were buyers. So positioning is turning less defensive, the covering continues, and nobody is pressing a short into the expiry. Overnight sets up the unwind. American futures are mildly green, the Dow up a quarter percent, but Asia is soft again, Japan down half a percent, Korea and Hong Kong both red.

So there is no overseas push, and our own futures sit at 24,631, a touch lower. Against yesterday's phantom 24,774 that is a gap down of about 140 points, but against the real 24,586 level it is almost flat to positive. Read that carefully, the market is not gapping down out of weakness, it is gapping down because yesterday's close was fake and this morning simply corrects it. 30, gold firm. Nothing in the macro is fighting the pin. So the lesson, and keep this for life.

From yesterday, the exchange stopped averaging the last half hour and started holding a single auction closing price, one price discovered in a short window at the bell. The intent is fairer, but on day one the auction book was thin, there was no price band to catch a runaway, and a burst of orders in the final seconds dragged the index number 188 points away from where it actually traded. Here is the durable rule, guys. When an index headline does not agree with its own future and its own stocks, you trust the futures and the stocks, never the headline.

The index is a calculated number, it can misprint. A thousand real trades in the future and the 50 constituents cannot all be wrong at once. So grade your levels off 24,586, not 24,774, and do not get trapped buying a breakout that never happened. So the plan, on today's weekly chain, and it is very simple. At the real level near 24,586 we are sitting inside the pin zone. Max pain is around 24,550 to 600. The biggest resistance of the week by a mile is the 24,600 call, a mountain of open interest, so that is the resistance the writers defend into the close.

57. Base case, a pin expiry in the 24,550 to 600 zone, the writers collect, the straddle bleeds. Above 24,600, held with real buying and not an auction trick, the door opens to 24,700, 24,750 easily. Losing 24,500 brings the market back to that 24,400 zone, and then 24,200 can also come into the picture. And the one thing that matters more than any level today is the close itself. So keep a very light position, guys. Weekly options settle on the cash close, so if the auction misfires a second time at half past three, the settlement price could be distorted on exactly the strikes you were trading.

So 24,600, 24,700, trade the real level all day, and treat the last minute as a wild card until the exchange fixes it. And a bookend on the week, the real catalyst is not today, it is tomorrow. 25 percent. So that is why volatility is cheap and the pin is the best case, the market is pricing a non-event. The only tail, same as Monday, is a hawkish hold, a bank that holds the rate but sounds worried on inflation. Keep a little cheap protection into that, and let today's pin run its course.

And a scorecard on yesterday, I will call it a four. com. So the plan, guys, is very simple. Check the open, see if 24,600 actually holds. If it holds, we are looking at 700 to 750 as the expiry. If it does not hold and we trade below 550 for more than 15 minutes, then 500 is your expiry pin. So keep a watch on the 24,500, 24,600 and 24,700 strikes, these are the strikes to watch for today, guys. So yesterday the screen lied and the future stole the truth, and the gap between them is the whole lesson, trust the tape, not the headline.

Today reality opens near 24,586, on expiry, on the pin, with one wild card in the last minute, and that is the reason you do not trade in the last 30 minutes, guys, do not take heavy positions into the close. This was The Tanmay Edge. If you found value in this, guys, please share it with one trader friend who needs it right now. com where it streams first. And give it a rating, guys, and a review if you want to add something to the podcast.