Levels and Plan for 26th Aug

It was 2 different auctions rolled into 1 session but the expected long liquidation near 16000 and sellers from 7965 F mentioned in the hypos played out fully.

Nifty Aug F


Background / Previous Auctions :

Medium Term :

The Friday May 16th range of 7560- 7125 (spot prices) forms the backdrop of the move we may see in the Nifty.The auction remains positive as long as we close above the highs of that day (May16) ( Friday 8th –  low was 7540 and close of 7568) The largest drop seen on May16 th was 432 points.Targets for the Upmove remain 7900 spot (achieved) and 8300 in the medium term. Support at 7500/ 7100 spot. 

Short term :

We are now seeing a two sided auction as we come into expiry week with buyers and sellers almost equal in number and volumes.

Support for the current  week has moved upto 7830 F from the  7725 F in the auction of last week. Resistance will be seen at 7965 and then at 8007.

Observations in Today’s session :


1) The market trended lower in the second session as sellers took control.

2)vwap of the day was at 7952 and a reference area for the auction tomorrow

3) Day type was a neutral extreme again as both buyers and sellers clashed but  the market closed at seller’s extreme

4) Failed auction at 7867 on Thursday 21st Aug is now on day T+2.

5) Maintain expiry week view of an auction between 7830- 7965 F.

6) Both Hypos played out in NF/ BNF in a 2 sided auction  but BNF Hypo1 fell short by 50 points as it failed to hit 16030.

Hypothesis  :

Hypo1 )  Looking at the shorts in the NF today, an open which stays under 7940 tomorrow will most likely go to 7887 and the FA point of 7867. Sl for this trade would be 7955.

Hypo2 ) Above 7955 today’s corrective is over and NF will be free to test 8007 again. Sl for this trade to be below 7938.

BankNifty F :


Background/ Previous Auctions :


Medium Term-

Medium Term Friday May16th range of 15730 14430 in spot provided a backdrop to the moves we may see in the BN for some time.

Within this range as long as we close above 15100 spot, the BN will trade towards 17680 .

Short Term :

The target of 15876 given above 15180 was hit on friday. Support for the week now rises to 15624.On the higher side 16030 is possible resistance this week.

Current day Observations :


1) Buyers seen at the open and near 15840 but the expected long liquidation happened early at 15950- 15975.

2) vwap of the day placed at 15860.

3) Buyers of 22/08 came under pressure as BNF tested the 15624 support mentioned in short term view

4) Hypo2 played out fully below 15820 open price.

Hypothesis  :

Hypo1) The short covering seen at the close in BNF may see BNF attempt 15740 near the OPen where the seller can push it down again to test 15625. Trade would be to short near 15740- 15765 with sl above 15825 for 15625.

Hypo2 ) Above 15840- 15878 the corrective of today has played out and BNF will rise again to the mentioned 15975/ 16030 supply zone.