Levels and Plan for 24th 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 of 2015 shows that the move has not terminated yet and we are still looking at 10400- 10800 targets  as long as we stay above 8200 now.

(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.

(Update 15/03/15)

The Market closed below the Feb series vwap of 8750 on the weekly. This means the path of least resistance now for the market is to 8473 spot which is the Jan series vwap.

Weekly levels  : 

(first updated 22/03)

(On spot prices)

For the coming week supply should be seen at 8669 and higher at 8722- 8754 spot which is resistance 2. The Outlook remains down till 8756 is not taken out on closing basis.

The Nifty closed on friday at the 8570 Minor support. We are 100 points away from the major support of 8473 which was our preferred route of the auction on the daily close below 8750 spot.

For the coming week we see 8510 and 8473 as the 2 major supports.

Observations in Today’s/ Previous  sessions :

(based on Fut prices)

#) The NF profile was a normal variation day with an incomplete auction at the close.

#) vwap of the day was at 8588 with volume of 81.05 L.

#) Anomalies in the profile of 19/03 are at 8736 and 8694.

#) Value areas are at 8606- 8596 – 8570

#) Profile shows buying at 8556 and a move below 8556 would be required to test 8510 F

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#) Heavy selling volumes were seen at 8806/ 8786 on 13/03

#) Profile showed sellers coming at 8788-8800 and 8704 and 8632 on Thursday 19/03

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

#) Excess seen at 8873 to 8832 on 13/03.

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

#) Scene of the crime was at 8832 F  on 13/03.

#) 9062 is also an anomaly which needs repair

Hypothesis  :

( Based on Futures) 

K.R.A is 8552  ( K.R.A= key reference area)

Hypo1 ) If NF auctions below 8552   then shorts stay in control  for 8510 F and below 8510 F to 8480 . Sl for this view is 8585.

Hypo2 ) If NF auctions above  8596   then it should move to 8624 and 8640. Sl for this view is 8552.

BankNifty Mar F :

 Medium Term-  20520 is now showing excess and the BankNifty has not been able to stay above the 19200- 19300 zone which hold vwaps for  Jan and Feb.  There has been some serious selling seen in the BankNifty at the 19370 spot levels this month. This makes us revise our opinion of the 18400 spot holding and we should see the index drifting down below to 17600- 17700 spot levels over the coming sessions.We will update our view to the potential next drop to 15900/ 15600 zone and finally 15100 once we see an auction at 17600 levels.

Weekly levels :

(first updated 22/03)

(based on spot prices)

The BN has support at 18550 and 18392 during the week and below that the year low of 18211 should provide relief. Resistance to any upmoves are at 18920 and 19100 during the week

Last week we pointed 19390 as supply and the BN stopped at 19373. This week we maintain 19204 as the min level for the bulls to cross to get a toehold in the instrument again. Till then it will remain sell on rises.

Observations in Today’s/ Previous  sessions :

(based on Fut prices)

#) The BNF profile was normal variation day with excess at 18774

#) vwap was at 18620 with volumes of  31.6 L

#) Last week’s lows were at 18620 the current vwap

#) WE see  a failed auction at 18860 on day T+1 today

#)Anomalies at 19224 and 19008 on 19/03

#) Imbalance objectives mentioned for the auction below 18770 yesterday were hit.

#) Value areas are at 18672- 18560- 18520

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#) sellers seen at 19335- 19395 again and down below at 18960 and 18855

#) Big volume selling seen on 13/03 again at 19404.

#) Excess seen at 19444 t0 19374 on 13/03 reconfirming the previous sellers in this zone

#) 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.

#) 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 18610 ( K.R.A= key reference area)

Hypo1)  IF BNF auctions below  18530  then it should move to 18385 and 18220 .   . Sl for this view is 18670

Hypo2) If BNF auctions above   18670   then it can move to 18750 and 18852  .  Sl for this view is at 18610.