Levels and Plan for 13th March

Medium Term : On Friday May 16th 2014, we saw a  range of 7560- 7125 (spot prices) and we believe it  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).

There was a failed auction noted at the lows on 17/10 at 7723 which is a reference point and support line for the future.

At the end of Dec 2014 we had reason to believe the the long auction in the medium term which started at 5920 early in 2014 may be consolidating for some time. However the Jan auction shows that the move has not terminated yet and we are still looking at 10400- 10800 targets through the coming year as long as we stay above 8200 now.

On the Monthly scale we are tracking 8750 as support through March. The Objectives of the run up are at 9036 then 9156 and finally 9280. Since the market is swinging up in 900 point increments the run off above 8668 can target 9568 at a later date.

(Update 08/03/15)

Post the RBI surprise the Nifty attempted 9119 just short of the 9156 estimate but failed to sustain above 9036 in the closing hour. The long liquidation which followed changed the short extreme short term and the market will have to dip lower to meet new buyers. Since the market looks to correct in 400- 450 point increments , we maintain 8750 stated above as a good place to buy all dips for the Medium Term..

(Update 11/03/15)

The Market has been closing just below the 8750 spot but with no signs of further selling or increase in selling momentum . A close back above 8750 negates the bearishness and opens the gates for a short covering rise.

Weekly levels  : 

(first updated 08/03)

(On spot prices)

For the second week of March resistance will play out in the Nifty between 8954- 8980 . Only a close above this band will negate some bearish momentum prevalent since wednesday.

Support lower is at 8825- 8844 price band and if this band does not support then Nifty can find security at the discussed 8752- 8770 band.

(update 09/03/15)

The Nifty tested the weekly support of 8752 spot today on the long liquidation. However buying attempts at the lows were feeble and the market may drift down again after a small rise. Any rise which fails to take out 8790 spot on the swing up could mean a further fall to 8679 and 8473.

Resistance weekly revised to 8790 and 8844 and supports to 8679 and 8589

(update 11/03/15)

The Nifty has been holding up at the 8679 weekly support ( low of 8677 so far this week) A  move above 8755 is a low risk long play now for 8846 to begin with . However we are open to the possibility of further long liquidation should 8679 break and the move can fetch 8589 below.

Observations in Today’s/ Previous  sessions :

(based on Fut prices)

#) The NF profile was a normal day which started as a local drive but stalled at 2 day highs.

#) vwap of the day was at 8803 with volume of 79 L.

#) The lower volume was not conducive for an attempted breakout  in the session and the NF closed at balance highs

#) We still await a strong trending day to come from this profile and will use value areas for bias

#) Since the auction stalled at range highs we await for confirmation in the session tomorrow and will maintain yesterday’s bias.

#) Imbalance below spike lows of 10th March targets 8616 F.

#) A probe above 8790 F however should bring 8830 F and 8917.

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#) Day Profile of 09/03 shows excess from 8866 to 8920 F

#) Scene of the crime was at 9063 F  on 05/03.

#) 9062 is also an anomaly which needs repair

Hypothesis  :

( Based on Futures) 

K.R.A is 8815 ( K.R.A= key reference area)

Hypo1 ) If NF auctions above  8815  then it should move  to 8860  and above 8860 to  8917 . Sl for this view is 8770.

Hypo2 ) If NF auctions below  8770   then it should move to 8732  and 8668- 8616 . Sl for this view is 8815.

BankNifty Mar F :

 Medium Term-  

18400 BN spot will be the key level to watch in BN over the coming weeks on a closing basis. As long as price stays above 18400 weekly closing the BN can make a move to 23500 levels. Highest volume traded in BN in 2014 was at 15100- 15200 spot levels. This 15100 will be the second layer of support in BN below 18400.

Weekly levels :

(first updated 08/03)

(based on spot prices)

For the coming week the BN has resistance at 19900 spot. Support lower is at 19410 during the week. However if 19376 breaks during the week then it will drop to 19277- 19204 immediately and 18872 if support at 19200 breaks

(Update 11/03)

The BN has drifted down to 18915 this week short of the 18872 support where visible short covering has happened. A close above 19200 spot should mean more short covering in the index and move it to 19466 spot to begin with.

Observations in Today’s/ Previous  sessions :

(based on Fut prices)

#) The BNF profile was a normal variation with a prominent POC at 19280

#) vwap was at 19284 with volumes of  22.3 L

#) The BNF was again an inside day today and within the balance after the trend day of Mon.

#) we pointed out the zone of 19376 holding sellers  and BNF was not able to penetrate it even today

#) Volume imbalance of the move is to 18778 F below 19000 and to 19624 if 19395 FA is taken out.

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#) The BNF put in an FA at 19394 on 09/03. Day T+2.

#) Break of 20250 triggered massive changes in structure and even the previous day buyers at 19960- 19985 were swept away in the down auction. of 04/03.

#) Pull back high of the day profile of 5th March is at  20312 which is short term resistance below 20740 now.

#) The Previous FA point in BNF is at  19883F .

#) Anomalies in the  auction of 04/03  is at  20112

#) Big Volume aggressive Sellers seen at 19576 , 19496 and 19376 in the afternoon of 09/03.

Hypothesis  :

( Based on Futures) 

K.R.A is 19220 ( K.R.A= key reference area)

Hypo1)  IF BNF auctions below  19160   then it should move to 19056  and 18884   . Sl for this view is 19240

Hypo2) If BNF auctions above   19240   then it can move to 19372 and 19492  .  Sl for this view is at 19196