Weekly charts (06th to 10th July 2020) and Market Profile Analysis

Nifty Spot Weekly Profile (06th to 10th July)
Spot Weekly – 10768 [ 10848 / 10676 ]

Previous week’s report ended with this ‘The weekly profile was an imbalanced one with Value completely outside previous Value at 10221-10350-10524 and represents a Double Distribution with the zone form 10447 to 10491 separating the 2 distributions. Nifty will need to get accepted above 10613 in the coming week to continue the probe higher towards the 2 ATR target of 10660 from this week’s FA and above it 10766 & 10865

Nifty opened the week with a gap up and remained above previous week’s high as it made a low of 10695 in the IB (Initial Balance) & went on to hit the next expected target of 10765 on Monday itself while making a high of 10811 before closing around the POC of 10765. The auction remained in a similar range on Tuesday but tested both the high & low of previous day as it first probed lower to make a new low of 10689 but was rejected which led to a spike into the close resulting in a marginal new high for the week at 10814. This imbalance continued at open on Wednesday as Nifty opened higher & went on to tag 10848 in the ‘A’ period but got rejected falling just short of the next expected weekly target of 10865 as it left a selling tail in the IB which meant that the upside probe seems to have been done. The auction then made a small OTF (One Time Frame) lower for the first half of the day but it took support just above the overlapping & prominent 2 day POC of 10765 as it left a PBL (Pull Back Low) in the ‘F’ period to reverse the slow OTF now to the upside as Nifty went on to test the initiative selling tail and was swiftly rejected from there triggering a big liquidation move in the last hour as the auction not only broke below the PBL of 10766 but went on to make new lows for the week at 10676 with a spike close of 10732 to 10676 leaving a double outside bar on the daily time frame. This spike was however rejected on Thursday as Nifty opened higher indicating that the fall was more an emotional one and this got more confirmation as it made a low of 10733 in the IB and left a small buying tail too which meant that the probe for the day would be on the upside but once again it was a rather slow probe higher as the auction once again started to form a balance around that 10765 zone for most part of the day before spiking higher into the close from 10817 to 10837. There is a reason that any closing spike cannot be trusted and needs more confirmation the next day which was displayed yet again on Friday as Nifty opened with a gap down right at that 10765 zone and took support there to bounce higher but could only make a high of 10819 in the ‘B’ period getting rejected from the spike low after which it made another slow OTF move lower for the first half of the day as it went on to break below PDL and test the spike of Wednesday (10732-10676) as it made a low of 10713 and left a small buying tail after which the auction got back into the balance mode it had been for the entire week leaving yet another narrow Value Area of just 42 points to close the day around the prominent weekly POC of 10764.

The overlapping Value on all 5 days of the week meant a very narrow Value Area range on the weekly too of just 60 points as Nifty formed a perfect Gaussian Profle with completely higher Value at 10746-10764-10806 and has a very good chance of giving an initiative move away from here in the coming week.

Click here to view this week’s auction in Nifty with respect to the previous week on MPLite

Nifty negotiated the 2-day composite of 9th to 11th March this week and now has the profile of 6th Mar and the 4-day composite of 2nd to 5th Mar to overcome on the upside

Main Weekly Hypos for Nifty (Spot):

A) Nifty needs to sustain above 10767 for a rise to 10806-817 / 10870-928 / 10975-990 & 11025-044
B) The auction staying below 10764 could test 10713 / 10666-625 / 10599*-557* & 10491

Extended Weekly Hypos

C) Above 11044, Nifty can probe higher to 11082-106 / 11131-154 / 11224 & 11290*
D) Below 10491, the auction can fall further to 10447-421* / 10372-350** / 10320-302 & 10260*

NF (Weekly Profile)

10766 [ 10845 / 10657 ]

Previous week’s report ended with this ‘The weekly profile resembles a DD with higher & expanding Value at 10266-10290-10596 and has a HVN at 10570 in the upper disribution which will be the level to watch in the coming week and would need some initiative volumes here to continue the probe higher

NF opened higher this week much above the 10570 level but ended up forming the second lowest weeky range of just 187 points in the year 2020 as it left a nice Gaussian profile on the weekly timeframe with completely higher Value at 10716-10732-10794. The auction has closed around the prominent TPO POC of 10752 and looks set to give a big move away from this balance in the coming week(s).

BankNifty Spot Weekly Profile (06th to 10th July)
Spot Weekly – 22398 [ 23080 / 22040 ]

Previous week’s report ended with this ‘The weekly Value was overlapping to higher at 21430-21920-22280 and we have a 2-week composite with similar Value at 21425-21893-22145 and coming week needs to get some initiative volumes around the 21900 zone if the auction has to move away from this balance

BankNifty did get some initiative volumes this week as it opened with a gap up and went on to match previous week’s high in the IB as it tagged 22343 but stayed in a very narrow range of 158 points for most part of the day displaying typical OAOR (Open Auction Out of Range) characteristic before it made an attempt to make a RE on the upside late in the day as it made new highs of 22399 which was swiftly rejected confriming lack of demand and this led to a probe lower resulting in new lows for the day around which it closed. The auction continued this probe lower on Tuesday as it made new lows for the week at 22040 but took support around that PBH zone of 22064 of last Friday which meant a change of polarity happening with the prior resistance turning into support. This test also revealed lack of new supply and this got the buyers into action as they not only left an extension handle at 22257 but went on to make new weekly as well as monthly highs of 22674 and in the process confirmed a weekly FA at lows. This imbalance continued on Wednesday as BankNifty continued to trend higher for most part of the day making multiple REs as it entered the Value Area of 17th Mar(click here to view the MPLite chart) and but the failure to tag the VPOC of 23138 and rejection at 23080 triggered a huge liquidation move into the close resulting in a Neutral Extreme Down Day as it made lows of 22499. As happens with most Neutral Extreme profiles, the auction failed to give any follow up opening above the reference of 22685 to 22499 and remained in previous day’s Value forming a balance but an attempt to make a RE lower in the ‘H’ period resulted in yet another Neutral Extreme profile but on the upside which also confirmed a FA at 22673 on the daily timeframe. The daily range & value were both inside previous day hence giving a nice 2-day composite with a prominent POC at 22807. Friday saw a lower opening in BankNifty which saw it revisting the FA of 22673 as it made a low of 22660 in the A period where it got rejected to start a probe higher in the IB as it went on to tag that prominent POC of 22807 but left a small but important tail at top which meant the auction was getting rejected. This rejection gave way to a trending move lower for the rest of the day as the auction made new lows for the day & went on to complete the 3 IB objective of 22320 in the ‘K’ period before closing the day & week at the DPOC of 22398.

The weekly profile resembles a DD (Double Distriubtion) with the first 2 days forming a lower balance with the POC at 22273 and the next 2 days forming a higher distribution with the POC at 22807 and on Friday we saw the rejection of the upper HVN with the fall stopping just above the lower HVN. Value for the week was completely higher at 22350-22810-22950 but close was near the VAL. 22273 would be the level to watch on the downside below which the auction would remain weak for a probe towards the VPOC of 22135, weekly FA of 22040 and below it the weekly VPOC of 21890 as immediate targets. Staying above Friday’s POC could see another test of this week’s POC of 22810 and will need initiative buying volumes there for a fresh move higher.

Click here to view this week’s auction in BankNifty with respect to previous week’s profile on MPLite

Main Weekly Hypos for Bank Nifty (Spot):

A) BankNifty needs to sustain above 22430 for a probe to 22553-651 / 22735-810 / 22898-950 / 23029-60 & 23138*-180
B) The auction below 22350 could test 22273*-200 / 22135*-040 / 21965-890** / 21825-749 & 21660-593

Extended Weekly Hypos

C) Above 23180, BankNifty can probe higher to 23266-333 / 23403-450 / 23565-624* / 23716-822 & 23901
D) Below 21593, lower levels of 21476 / 21390-315 / 21230-165 / 21076-000 & 20918-880 could come into play

Additional Weekly Hypos

E) If 23901 is taken out, the auction can further rise to 24025-074 / 24181-280 / 24337-414 / 24509* & 24576
F) Break of 20880 could lead to a fall to 20774-733 / 20640 / 20570-540 / 20445-390 & 20320-211*

BNF (Weekly Profile) 

22436 [ 23118 / 22001 ]

BNF also opened higher this week and remained above previous week’s Value as it formed a relatively lower range of 1117 points as it made new highs for the series at 23118 and a low of 22001 which was also a weekly FA (Failed Auction) and will be the important level to watch out for below 22423 in the coming week. Value was completely higher at 22308-22752-22906.