Last week higher OTF of the multi month kind came at Monday’s open forcing the index lower below the 7950 spot support we had mentioned as support which in itself was a catalyst to shave off 300 points off the index in hours as we hit 7667 in tuesday’s trade. However the index managed to hold 7725 in that panic low and came back to test Monday’s gap down region and the weekly close was above 7940 spot.
The heightened vix readings and the inter market plays point to a 2 way range in the coming weeks which requires a lot more discipline and belief as well as a thorough trading plan to trade the instruments. These kind of sessions are the best we have seen since 2007- 2008 and carry with them the opportunity to make some serious profits or huge dents in your trading account.
Last week’s levels went off in the first few minutes of Monday’s trades as the gap down did not show new buying in our OrderFlow charts. Last week’s post can be reviewed here : http://vtrender.com/nifty-bn-weekly-view-spot-for-24-aug-28-aug15/
As we look at the weekly this week, our sights are on the Monthly as well in line with the observations we have been making in the trading room of a much higher Time Frame at play in the current markets. Thus from a 8520 close last month we will be looking to close tomorrow much lower and in an incomplete DD on the monthly ( chart below ). Vwap for Aug series was at 8287 and will be key resistance going forward.
Nifty :
Last week’s responsive buyers took the index above 7940 on a weekly closing basis. The volumes seen project 8134 levels in the coming week as long as the index stays above 7905 levels. . Below 7905 support is at the weekly POC of 7855 and if the POC gets broken then the index can drop to 7725 again.
Above 8135 spot, the index should be clear to rise to 8285 which is the vwap of Aug series.
So, we will like to take clear biases below 7905 and above 8135 in the coming week . We will let emerging OrderFlow lead us to the rest.
BankNifty :
Last week’s responsive buying in the BN should support the index in the coming week as long as the trade stays above 17100 spot. We saw selling coming back near 17490 spot in the week gone by and that remains the early resistance in the coming week.
Below 17100 POC the VAL at 16890 is minor support and once broken would confirm a retest of last week’s lows near 16670 levels.
Strength above 17574 should take the index to 17825 and around 18100- 18180 which has Aug series vwap.
As we have mentioned the presence of a much higher OTF in the current markets we will also keep watching vix which above 17.50 levels continues to point towards elevated volatility in the markets. The vix has resistance at 25.95 levels in the week and once crossed can retouch 29.75 again.
In the USDINR aug F we see support at 66.15 in the week and above 66.80 resistance the index can do 67.20 and 67.85 .