Nifty :Another neutral day where the markets reversed direction mid-stream . What started off as long inventory of the morning unwinding, soon resulted in aggressive day shorts coming in which took the market down to it’s lows.
In the morning the market attempted to travel through the 3 day balance area as per the possibilities extended in the post of yesterday :
“The possibilities are for a move through the balance to bring 4810 and 4848 or back below 4730 towards 4660-4640”
However it was surprising to see the market attempt both in one day and only the real quick trader would have been able to capitalize on the opportunity which the market threw at us yesterday.
Looking at the EOD picture, we see single prints at 4758 ( blue horizontal line) which is at the base of the 3 day profile and an example of institutional selling.The single prints covered the entire value area of Thursday also before more selling came into the close as liquidation of long inventory.
4668 and 4701 will be important levels for Monday’s trading. 4668 is an anomaly which should be revisited and 4701 invites the 80% rule to be operational again.Holding below 4701, the market may attempt to complete the profile from Friday as a double distribution pattern.
Lower side support now is at 4536 levels. A close above 4715 on Monday or Tuesday will bring a retest of 4825- 48 regions.
Large volumes were seen at 4626 levels as also 4792 during the RBI announcement.
BankNifty :
The BankNifty has a more irregular structure than the Nifty with anomalies at 8421, 8344, 8204.
Large volume was seen at 8500.
Immediate support for this index is at 8001 and then 7675.
