Weekly charts (20th to 24th July 2020) and Market Profile Analysis

Nifty Spot Weekly Profile (20th to 24th July 2020)
Spot Weekly – 11194 [ 11240 / 10953 ]

Previous week’s report ended with this ‘The weekly profile is a Neutral Extreme one on the upside which also resembles a DD with both range & value forming an outside bar compared to previous week. This week’s Value is at 10644-10806-10836 and the immediate reference for the coming week would be the spike close of 10848 to 10933. On the upside, acceptance above 10933 can bring a test of the VAH of 10981 of 6th Mar and the huge selling tail from 11035 to 11269 with 11224 being the VAL of the 4-day composite and 11290 being the VPOC

Nifty opened higher well above the Neutral Extreme reference of previous week which was from 10848 to 10933 and formed a balance staying in a narrow 60-point range between 10956 to 11017 for most part of Monday before it made an attempt to probe lower in the ‘I’ period which was swiftly rejected resulting in a FA (Failed Auction) being confirmed at 10953 as it made new highs for the day at 11038 which was the start of the selling tail mentioned above. The auction continued this imbalance on Tuesday as it made a gap up open and stayed above the 1 ATR objective of 11095 while making a low of 11113 but once again formed a narrow range balanced profile of just 66 points for the entire day which included a marignal RE (Range Extension) higher to 11179. Wednesday saw another gap up in Nifty as it made a high of 11238 at open completing the 2 ATR target from the FA of 10953 and was swiftly rejected after it tested the VAL of the 4-day composite from 2nd to 5th Mar 2020 for the first time (chart attached below) leaving a selling tail in the large IB (Initial Balance) of 136 points. The auction went on to extend the range to the downside as it made a low of 11056 late in the day but was met once again with some swift rejection as it bounced back to close the day at 11132 leaving a ‘b’ shape profile for the day and opened at the same level on Thursday where it left a small buying tail in the IB after which it went on to negate previous day’s selling tail as it formed Value in that zone and even went on to test the PDH (Previous Day High) as it made a marignal new high of 11240 to close the day at 11215 leaving a ‘p’ shape profile and as this came just after a ‘b’ shape profile, it meant that the market was now forming a balance. Nifty confirmed this on Friday as it opened with a gap down which was the first time in 8 days and did the reverse of previous day forming Value in the buying tail of Thursday’s ‘p’ shape profile where it even made a RE to the downside in the ‘D’ period to tag 11090 but took support at the last 2 day’s IBL level of 11103 and went on to make multiple REs late in the day to the upside as it hit 11225 and in the process completed the 2 IB objective for the first time in the week closing the day with Neutral Extreme profile at 11194.

4-day composite

Value for the week was completely higher at 11109-11133-11217 and due to the overlapping range and Value of the last 4 days, the weekly profile looks like an imbalanced DD (Double Distribution) with a small balance in the lower half which has a daily VPOC at 10978 & the FA of 10953 as important references along with a much larger balance in the top half. Nifty could continue to remain in this balance unless it is able take out the similar highs it has formed at 11240 effectively for a probe higher towards the composite VPOC & VAH of 11290 & 11388 respectively in the coming week.

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

Profile of the 4-day composite of 2nd to 5th Mar that needs to be overcome on the upside

Main Weekly Hypos for Nifty (Spot):

A) Nifty needs to sustain above 11205 for a rise to 11240 / 11265-290 / 11343 & 11388-396
B) The auction staying below 11179 could test 11130 / 11090-055 / 11022 & 10978-953

Extended Weekly Hypos

C) Above 11396, Nifty can probe higher to 11426-450 / 11503-537 / 11582*-611 & 11664
D) Below 10953, the auction can fall further to 10921 / 10894-869 / 10806-781 & 10740-713

NF (Weekly Profile)

11170 [ 11228 / 10921 ]

NF opened higher on Monday above previous week’s Neutral Extreme reference of 10879-10936 and on an entry back into this zone got swiftly rejected and confrimed a FA at 10921 which set up for a fresh up move as it completed the 2 ATR objective of 11222 while making a high of 11228 for the week forming a DD type profile with a large balance in the upper distribution which also contains this week’s Value which was completely higher at 11058-11145-11214 and a close right in the middle of this Value.

BankNifty Spot Weekly Profile (20th to 24th July 2020)
Spot Weekly – 22662 [ 23211 / 22187 ]

Previous week’s report ended with this ‘The weekly profile represents a ‘b’ shape long liquidation profile with Value completely lower at 21240-21680-21840 but the close at 21967 puts BankNifty as of now in a Neutral Zone with the PLR (Path of Least Resistance) slightly on the upside but will need to take out that extension handle of 22381 for a probe towards the weekly VPOC of 22810 in the coming week

BankNifty opened with a gap up of 340 points on Monday and continued to probe higher negating the extension handle of 22381 as it made a high of 22520 in the IB but could not extend as it left a rare Normal Day with a prominent POC exactly at 22381. The auction made another 300+ point gap up on Tuesday as it scaled above previous week’s high of 22658 but once again remained in the IB range of just 158 points for most part of the day before spiking higher in the ‘K’ period as it made a high of 22862 and in the process tagged the weekly VPOC of 22810. BankNifty then completed a hat-trick of 300+ point gap up on Wednesday as it made new highs for the month at 23211 tagging the VPOC of 23138 of 17th March but it also turned out to be an exhaustion gap which not only got immediately closed but resulted in a fall of 547 points in the ‘A’ period itself and the day formed a ‘b’ shape long liquidation profile with a selling tail from 23011 to 23211 and the POC at 22768. Thursday saw the auction leaving a small buying tail at this POC which indicated that no new selling was coming in after which it probed higher all day making multiple REs as it got into previous days selling tail but made similar highs in the 23110-120 zone which confirmed exhaustion. This led to a gap down open on Friday of 230 points which was also an almost OH start at 22854 as BankNifty made a trending move lower for the first 4 periods as it made a low of 22418 in the ‘D’ period but held on just above Monday’s VPOC of 22381 which meant that this zone was still seeing some demand. There was another attempt made to probe lower in the ‘H’ period but could only make a marignal new low of 22417 and this failure of the sellers triggered a short covering move into the close as the auction went on to test the morning selling tail where it got rejected and left a PBH at 22759 before closing at 22662.

The weekly profile resembles a DD with completely higher Value at 22530-22670-23110 and has closed right at the prominent POC of 22670. On the downside, the daily VPOC of 22381 will be the important reference in the coming week below which BankNifty could turn weak whereas on the upside, staying above 22670 could give a probable rise to 22850 & the higher VPOC of 23027 and finally the weekly selling tail of 23122 to 23211.

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 22670 for a probe to 22760-850 / 22911-944 / 23027-122 / 23181-260 & 23333-450
B) Staying below 22650, the auction could test 22560-518 / 22417-345 / 22274-200 / 22137-050 & 21973-903

Extended Weekly Hypos

C) Above 23450, BankNifty can probe higher to 23565-624 / 23716-822 / 23901 / 24025-074 & 24181-280
D) Below 21903, lower levels of 21831-770 / 21680-609 / 21550-500 / 21390-280 & 21171-025 could come into play

Additional Weekly Hypos

E) If 24280 is taken out, the auction can further rise to 24337-414 / 24509*-576 / 24650-744 / 24810-912 & 25008-111*
F) Break of 21025 could lead to a fall to 20953-880 / 20774-640 / 20570-445 / 20390-320 & 20211*-100

BNF (Weekly Profile) 

22611 [ 23148 / 22122 ]

BNF opened higher this week taking out the supply points of previous week on Monday itself as it trended higher with help of 3 consecutive big gaps till Wednesday morning opening where it made a high of 23148 from where it gave a good retracement to 22321 on Friday before closing the week at the HVN of 22607. Value for the week was completely higher at 22477-22669-23127.