A trend day in the market dominated by the buyers showed us strong aggressive buyers picking up all available dips in the Banknifty and equally aggressive sellers in Nifty F shorting at the highs.
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Nifty OCT F |
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Background / Previous Auctions : Medium Term : We have maintained from Friday May 16th that the range of 7560- 7125 (spot prices) seen on that day forms the backdrop of the moves we may see in the Nifty for a considerable amount of time, as it was a 5 sigma event. The auction remains positive as long as we close above the highs of that day (May16) ( Friday 8th Aug – low was 7540 and close of 7568) The largest drop seen on May 16 th was 432 points and the rally from 5110 has never been penetrated by a drop of more than 430 points . Targets for the Upmove as long as 7900 spot holds (+/- deviation of 50) are 8300/ 8581 in the medium term. Support at 7900/ 7500 spot. Our Profile studies indicate 11600 as a long term target on the Nifty in 2016-17 provided 6300 holds through 2015
Observations in Today’s session : https://www.dropbox.com/s/4g5gs9rqde49cv9/Oct_NF.png?dl=0 1) A trend day with a gap up which caught yesterday’s late sellers off guard in the Nifty F forcing a quick closure and hypo2 tgt early in the session. 2) Today’s chart shows a profile which was a double distribution above our hypo2 target but one which failed to attarct new buyers above 7983. 3) Orderflow Data shows shorts building up on the rise at 8000- 7988. the levels around 7968- 7955 shows sellers trying to come back into the day and some part covering as well. So 7955 on the lower side will be an important level tomorrow. 4) Profile was imbalanced towards the downside at the close slightly in the NF. Hypothesis : Hypo1 ) An auction below 8004 tomorrow will bring 7981 up as a test and a further probe below 7981 will test the above mentioned 7955. SL for this view is 8017. Hypo2 ) Above 8007 the NF will bounce higher to 8057 which would be a good closing point for the week. Sl for this view is 7980.
BankNifty Oct F : |
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Background/ Previous Auctions :
Medium Term- Friday May 16th range of 15730- 14430 in spot provides a backdrop to the moves we may see in the BN for some time. There is a 1000 point move in BN when it trades above 15800 spot Our bias is positive above 15100 spot, and as long as the BN stays above 15100 we will trade towards 17680
Observations in Today’s session :
https://www.dropbox.com/s/r4rbs7x5ci8huw0/Oct_BNF.png?dl=0 1) The profile in the BNF was trending today after 2 back to back rotational days. 2) Buyers were seen early in the day near 15630 3) day type was a double distribution day 4) profile was slightly imbalanced towards the upside at the close today
Hypothesis : Hypo1) If we stay below 15870 tomorrow then BNF can move to support 1 at 15748 F. Below 15740 it can drop to 15630. Sl for the view is the trend day high of 15870 which if crossed can invite short covering again. Hypo2 ) Above 15870 it will move towards 15971 which will be a good weekly close for the index. |