Over the weekend, I made two observations on two of the indices I follow and trade on, and they both had to go off together for me to execute my plans on them.
The Nifty had to bounce off 5180 strongly and the ES had to bounce off 1147.
For the Nifty, I didn’t see the bounce, only a tick on my ODIN confirmed it. Later on I was told that it was a false tick, but at that moment it was enough for me to buy the gap down.Price got rejected precisely at POC and it was enough for me to start thinking short again.
That’s for today, let’s look at the charts to see what we have tomorrow.
For the Nifty, we have had a break of the 50 point range from last week. Yes a 50 point range again- Nifty is choosing to do this again between 5220 and 5272 last week as against 5100-5155 from the week prior.
But I am not very convinced that we have had a break of the range yet, because it was a single print movement in the first half hour as well as the last half hour below 5220. Not convincing is the way I see it.
So 2 possibilities for tomorrow and they both involve 5220 ( give or take a few)
1) Auction in the low volume 5220- 5175 range, where 5177 should provide a support for the market
2) back in the 5220-5272 range and rotation.
(I am more biased towards a rotation back into 5220-5272, but we’ll see)
I admit it is not very helpful, but our ever reliable purple lines ( value areas ) will show you the way. As before we will play an exit of value tomorrow.