Market Profile Analysis dated 23rd Jan

Nifty Jan F:

NF opened around yVAL and probed above the yPOC of 10935 and the yVAH of 10941 and looked like driving higher but the auction got stalled at the FA level of 10958 indicating that there is still supply coming in at this level. The auction then turned lower and made a lethargic move on very low volumes to first go below VWAP and then broke below the yVAH to initiate the 80% Rule in the bell profile of yesterday. NF almost completed the 80% move but like in the morning, the move down also got stalled at the weekly POC & yVWAP of 10923 reversing the auction. NF then probed higher & after making a small balance at VWAP made a move to the upside tagging the IBH making a new high of 10962 but was not able to sustain above IBH and was pushed back into the IB leaving a probable FA at highs to match the earlier FA of 10958. NF then repeated the slow move down balancing at VWAP for a while after which it gave a fast move down to get below earlier lows of 10925 and went on to break the IBL also completing the 80% Rule to the ‘T’ making a low of 10916 which was the yVAL. The break of IBL meant that the FA at 10962 was confirmed and unless NF captured VWAP soon the PLR was well & truly down. NF did make a swift move back into the IB raising expectations of a probable FA at lows and the auction went on tag VWAP and made multiple attempts in the ‘J’ period to get above it but was not successful as there was also an HVN that was forming since morning at that level which added to the resistance. This late afternoon rejection of VWAP often gives a big move away into the close and the same happened today with NF giving a trending move lower into the close leaving an extension handle at 10917 and a spike of 10913-10835 to give a Neutral Extreme Down Day also tagging the 3 IB range extension to the down along with the 1 ATR move of 10857 from the FA of 10962. Spike Rules will come into play for tomorrow open.

• • The NF Open was a Open Auction In Range 
  • The day type was a Neutral Extreme Day (Down)
  • Largest volume was traded at 10845 F
  • Vwap of the session was at 10923 with volumes of 79 L in a session which traded a High-Low range of 10962-10835 for a range of 127 points 
  • NF confirmed a FA at 10962 today and closed below the 1 ATR level (10858) so seems on for the 2 ATR move down to 10755
  • NF had left a FA at 10958 on 17/01 and closed below it yesterday. The auction completed the 1 ATR move on downside which comes to 10844. The 2 ATR move down would be at 10730
  • NF had left a FA at 10678 on 04/01 and tagged the 1 ATR move of 10803 & closed above it. The 2 ATR target of 10928 was tagged on 15/01. This FA has not been tagged and is now strong support
  • NF had left a FA at 10580 on 26/12 & completed the 2 ATR move up to 10862. This FA has not been tagged and is now strong support
  • The VWAP & POC of Dec Series 10796 & 10741 respectively
  • The VWAP & POC of Nov Series 10480 & 10580 respectively.
  • The VWAP & POC of 31/10 10250 & 10248 will be important levels going forward

You can check the monthly charts & other swing levels for Nifty & NF here & for the weekly charts & analysis, please click here.

Daily Zones:

• • Value zones (volume profile) are at 10835-10845-10937

Hypos / Estimates for the next session:

a) NF closed in a spike of 10913-10835 so spike rules in play for next open
b) Below 10835, NF can probe lower to test the extension handle of 10820 & 10805
c) NF has immediate resistance at 10860-872 zone above which it can move higher to 10890 & 10902
d) The auction has bigger resistance in the 10923-10942 zone above which it can do 10962 & 10990
e) 10805 if broken & sustained, NF can go for that vPOC of 10760 & the 2ATR move of 10751

BankNifty Jan F:

BNF again gave an OAIR start just below yVAL and got back into the previous day’s Value completing the 80% Rule of the narrow 50 point range and went on to tag the vPOC of 27581 where it seemed to have met supply as the auction could not sustain above 27560-27568 levels which was the previous day high & the weekly POC. The auction then balanced in a narrow band of 27520 to 27560 before the ‘E’ period attempted a probe higher after which the next 2 periods ‘F’ & ‘G’ also probed higher getting above the IBH and making a new high of 27611. BNF did stay above IBH for sometime but did not attract new demand and the auction was pushed back into the IB by sellers who were now aware that there is no buying coming at highs. BNF then probed lower the next 2 periods ‘H’ & ‘I’ taking support at 27500 after which it gave a small bounce to VWAP which was rejected in the ‘J’ period where BNF also made an inside bar. The ‘K’ began below VWAP & went on to break 27500 to trigger a big move to the downside breaking the morning lows of 27462 thus confirming a new FA at 27611 & probed below yesterday’s FA of 27435 tagging 27380 which was the 1 ATR move down from today’s FA & also just above the previous swing low of 27377. BNF then attempted a small bounce which got rejected at the FA of 27435 which indicated that the downside probe is still not over and BNF then went on to make new lows for the day breaking below the vPOC of 27350 and ended up breaking the previous week’s low of 27300 and also the swing low of 27292 making a low of 27275 giving a Neutral Extreme profile. The reference for next day open would be the zone of 27275 to 27462 above which BNF has an extension handle at 27500. The auction seems to have moved away from the composite it had been forming since 7th Jan and the PLR remains down till it stays below these reference levels.

• The BNF Open was a Open Auction In Range 
• The day type was a Neutral Extreme Day (Down)
• Largest volume was traded at 27530 F
• Vwap of the session was at 27493 with volumes of 22.9 L in a session which traded a High-Low range of 27611-27274 for a range of 336 points
• BNF confirmed a FA at 27611 today and closed below the 1 ATR level (27382) so seems on for the 2 ATR move down to 27153
• BNF left a FA at 27435 on 22/01 but got below it today and closed much lower. The 1 ATR down move from the FA comes to 27195
• The VWAP & POC of Dec Series 26713 & 26832 respectively
• The VWAP & POC of Nov Series 25686 & 26218 (Spot) respectively
• 31st October’s VWAP of 24895 & POC of 24900 will be important levels going forward

For the Monthly charts & other swing levels for BankNifty & BNF click here & for the weekly charts & analysis, please click here.

Daily Zones:

• • Value zones ( volume profile) are at 27409-27530-27606

Hypos / Estimates for the next session:

a) BNF confirmed a FA at 27611 today and completed the 1 ATR move of 27381 with a close below it so the PLR remains down for a move to the 2 ATR level of 27153
b) The auction has immediate resistance at 27380 above which it can attempt to tag 27435 & 27500
c) BNF has immediate support at 27274 below which it can probe lower to tag the pull back low of 27205
d) Below 27205, BNF can move lower to 25150-112 & 27060-55 levels

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