Another inside day in the Nifty wth one of the poorest volumes in recent times left a spike at the lows as the short term auction left reference lines at the same points yet another day
Nifty DEC F |
| 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) 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 450 points. In the current context the drop from the last Nifty spot swing high of 8180 to the recent swing low of 7723 made on 17/10 equals 457 points. Conversely the Nifty has run up straight 2 times for 936 and 925 points . The upmove from 7723 to 8626 measures 903 points.
There was a failed auction noted at the lows on 17/10 at 7723 which is a reference point for the future.
Short Term :
(On spot prices) The Nifty has managed to stay above the longer time frame supply at 7920- 7940 spot. This region is also now new support over the short term. The previous swing high of 8180 spot has excess now and is also a higher support for the index.
Our yearly target of 8580 spot has been hit and the Nifty’s reaction at this price point has been that of consolidation at the highs which increases the chances of further upsides as sellers not seen capable to drive prices lower yet.
Our preferred scenario of a consolidation move for 8- 12 sessions is playing out fully and we wait for a Santa rally around Dec 18- 20 to drive the index in the next leg up.
As of the moment, upside is open till 8748- 8788 for dec above 8625 cross . Downsides for dec should be restricted to lows of 8400- 8349 where buyers should respond again
Observations in Today’s/ Previous sessions :
(based on Fut prices)
#) The NF had an inside day and operated within the range of thursday’s session. #) The auction of the day had a spike into the close. Spike was 8612- 8567 and spike rules apply at open tomorrow. #) Failed auction was noted at 8540 (2/12) and will be a ref point for the coming sessions # Bracket high of 8516-8492F should cushion any immediate downfalls.
Hypothesis :
( Based on Futures)
Hypo1 ) If NF auctions above 8612 then longs will target 8634 F and 8660 F. Sl for this view is 8586
Hypo1 ) If the auction goes below 8585 then NF will go back to 8567 and 8540 . Sl for this view will be 8607.
BankNifty DEC F : |
| 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. Our 2014 target of 17680 has been met. Larger Imbalance objective above 17680 works out to 18700- 18934. Meanwhile 1768- 17710 is developing as a nice base and a support line for the futureShort term :
(based on spot prices)
For the current week the auction has support at 18618 Resistance to the upmove will be at 18934. Auction is positive above 18300 spot and should find dipp buyers as long as 18300 is held.
Observations in Today’s session :
(based on Fut prices)
#) The BNF profile was a normal day type today contained in the IB #) vwap placed at 18877 in the normal day and should guide the bias for the morning session on Mon. #) On 02/12 we see a failed auction at 18404 F which is a ref point for the coming sessions #) excess seen at 18240 on 28/11
Hypothesis :
( Based on Futures)
Hypo1) If BNF auctions above 18770 then it should move to 18860 and 18930. S for this view is 18720.
Hypo2) IF BNF auctions below 18720 then it should trade towards 18630. Sl for this view is 18775. |