- The short — pre-open five-liner
- First 90 minutes: rules & triggers
- Rotation map & earnings tells
- Breadth & risk markers
- Sizing guardrails
The short
- Leaders: Banks, capital goods — orderbooks + asset quality keep RS intact.
- Improving: Autos, pharma, power — breadth expands into mid-Oct; watch inventory and US price pressure.
- Cooling: IT midcaps — prefer cost-takeout/automation names with TCV proof.
- Flows: Domestic savings steady; fade low-float spikes lacking anchor/float clarity.
- Macro: FX rangebound; Brent in mid-60s — retail fuel bands stable near-term (directional).
First 90 minutes — execution rules
Open → +30 min
- Leader sectors gap <0.6% with rising breadth → add on first higher-low; stop = VWAP −0.5%.
- Gap >1.2% → wait for two 5-min closes above VWAP before entry.
+30 → +60 min
- Fade failed breakouts in IT midcaps if RS vs Nifty slips 50 bps with supply uptick; risk ≤0.4R.
- Autos: avoid names showing discount escalation; track dealer weeks of inventory.
+60 → +90 min
- If A/D rolls while leaders flat → trim microcap beta; rotate to liquid leaders.
- Hold fresh risk pre mid-day earnings calls; add post-color if guideposts clear.
Rotation map (illustrative)
| Sector | Status | Driver | Risk flag | Positioning cue |
|---|---|---|---|---|
| Banks | Leader | Credit growth, asset quality | Deposit beta creep | Favor OCF/EBITDA > 0.8, lower wholesale mix |
| Capital Goods | Leader | Backlogs, execution | Input costs | Diverse orderbooks; service mix |
| Autos | Improving | Festive builds | Inventory > 6 weeks | Trim on sustained discounting |
| Pharma | Improving | US launches + India | US price erosion | Prefer steady GM + ANDA pipeline |
| IT | Cooling | Delayed ramps | US macro scare | Stick to TCO/automation leaders |
| Power | Improving | Demand + tariffs | Fuel linkages | Blend regulated + merchant |
Breadth & risk markers
- A/D > 1.4× with leaders green → add risk; < 0.9× → step down beta.
- Smallcap/Nifty ratio near prior swing high → avoid illiquid adds.
- Watch guidance quality on earnings names, not just prints.
Sizing guardrails
- Cap single-name risk ≤2.0R intraday; no financed punts into event hours.
- Rule breach: two failed signals → stand down for session.