Typical of every RBI day we saw strong 2 time frame activity in the market as sellers entered the NF at higher levels after bulls looked like exerting control for a higher monthly close.
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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 neutral day with both buyers and sellers and a close in favor of sellers. 2) vwap of the day was at 8015 again 3) OrderFlow chart above shows sellers entering at 8064- 8068 F 4) Today’s data also shows strong liquidation in the 8000- 8012 zone of yesterday’s longs 5) 8020- 8056 remains a poorly auctioned zone 6) Profile was imbalanced towards the downside at the close Hypothesis : Hypo1 ) An auction below 7999 tomorrow will go to test the 7956 support we have been talking about since past 3 sessions in our hypos. Below that the NF can fall to 7900 . Hypo2 ) Above 8004 the NF meets the vwap of 8014 and above 8016 longs can be taken for a 20 point move to 8036 and a possible 8056 with stops below 7997. 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 balanced today and rotational in a 200 point range 2) vwap of the day placed at 15540 3) The Sellers were seen operating near 15660 again 5) day type was neutral. Hypothesis : Hypo1) If we stay above 15515 at the Open then BNF can move to 15630-15650 again to check the supply there. Hypo2 ) Below 15470 the BNF will fall again to 15350 and 15275. |