Weekly charts (23rd to 27th September) and Market Profile Analysis

Nifty Spot Weekly Profile (23rd to 27th September)
Spot Weekly 11512 [ 11695 / 11416 ]

Nifty continued the imbalance it started last Friday as it opened at 11543 on Monday giving a huge gap up of 260 points and made a freak high of 11666 in the opening minutes as it tagged the monthly VPOC 11576 (of the Triple Distribution Trend Down profile of July) & then above it the weekly VPOC of 11654 which were couple of major objectives and this led to a retracement as the auction made new lows for the day at 11471 taking support in the gap zone & reversing the probe back to the upside as Nifty not only visited the freak high but went on to make new highs of 11695 but could not sustain above IBH as it closed the day at 11600. Tuesday was an inside day as the auction remained inside the previous day’s range leaving a well balanced profile and on Wednesday the auction seemed to give a move away from the 2 day balance as it gave a drive down after an OH (Open=High) start at 11565 & probed lower getting into the gap zone as it made a low of 11416 and closed just above the lows. Nifty however negated this weak close on Thursday as it opened higher and reversed the previous day’s fall to get back again into the 2 day balance as it made highs of 11611 indicating that the auction was forming a bigger balance now. Friday was another inside day as the initial attempt to probe higher got stalled at 11594 after which the auction made the narrowest range of the week completing a nice Gaussian profile on the weekly time frame. The PLR (Path of Least Resistance) remains to the upside as we have a buying tail from 11421 to 11274 because of which the weekly Value was completely higher at 11498-11574-11618 but it needs to be seen if we get a move away from this balance immediately as the close was near the VAL (Value Area Low) so Nifty could continue to build Value here before making the next move.

Weekly Hypos for Nifty (Spot):

A) Nifty needs to sustain above 11511 for a move to 11557-574 & 11611-618
B) Immediate support is at 11503-498 below which the auction could test 11449-421 & 11396-381
C) Above 11618, Nifty can probe higher to 11645-665 / 11707-719 & 11766-773
D) Below 11381, lower levels of 11290-274 & 11236 could come into play
E) If 11773 is taken out & sustained, Nifty can have a fresh leg up to 11811-828 / 11862-882 & 11912-937
F) Break of 11236 could bring lower levels of 11187-184 / 11151-131 & 11078-73

NF (Weekly Profile)
11295 [11406 / 10705]

NF gave a gap up opening of over 200 points this week and continued to probe higher on Monday as it left a big daily range of 242 points making a high of 11727 and in the process completing a 1000 point run in 2 days from the Friday’s low of 10721. As it always happens in Market Profile, ‘Balance leads to imbalance & imbalance leads to balance’, the auction then got into a balance mode for the rest of the week as it remained within the Monday’s range for the remaining 4 days making a nice Gaussian profile on the weekly time frame with higher Value at 11568-11628-11652 and has a buying tail on a longer time frame from 11501 to 11335 with an extension handle at 11445 in between which would be the support levels in the coming week. On the upside, NF has a prominent POC for the week at 11628 which it will have to take out on good volumes to start a new leg on the upside.

BankNifty Spot Weekly ProfileĀ (23rd to 27th September)
29877 [ 30801 / 29470 ]

BankNifty opened the week at 30039 which was a gap of more than 1000 points and climbed further to tag the 30550-560 zone in the opening minutes which had a weekly as well as a monthly VPOC and tagging this objective paused the upmove for a while as the auction probed lower and took support in the gap zone as it made a low of 29776 leaving a long buying tail from 29848 to 28981 after which it made a RE (Range Extension) to the upside in spite of the 809 point IB (Initial Balance) and went on to make high of 30801 completing a breathtaking 4000 point rally in just 2 days and this huge imbalance gave way to a balance being formed for the rest of the week. The first indication of this was the lower opening on Tuesday after which the auction got rejected at 30668 when it made an attempt to probe higher leaving a selling tail in the IB from 30668 to 30435 which led to a RE to the downside as BankNifty made lows of 29889 taking support just above the previous day’s buying tail and gave a rotation back to 30412 as it stalled just below the morning singles which meant that the sellers are still very much in the game. The auction then made a Open Test Drive lower on Wednesday and made new lows for the week as it tagged 29470 holding just above the previous week’s high of 29419 while leaving a ‘b’ shape profile for the day which either meant that the sellers were getting tired or that the demand was coming back and this got more the next day BankNifty gave a drive up after opening in the previous day’s range and went on to make a spike high of 30718 in the ‘C’ period which was swiftly rejected as the auction left a selling tail from 30390 to 30718 which was similar to the one it had left on Tuesday re-confirming that the upside for the time being was limited as the auction returned to balance mode and closed the week with an inside day on Friday with the narrowest daily range of just 401 points completing an elongated but balanced profile for the week with Value completely higher at 29755-30050-30380. The close has been near the VAL so BankNifty could continue to balance in the coming week before starting the next phase of imbalance.

Weekly Hypos for Bank Nifty (Spot):

A) BankNifty needs to sustain above 29930 for a move to 30016-50 / 30105-113 & 30170-190
B) Immediate support is at 29850-835 below which the auction can test 29755 / 29671-640 & 29585-575
C) Above 30190, BankNifty can probe higher to 30277 / 30364-388 & 30451
D) Below 29575, lower levels of 29506-470 / 29418-383 & 29327 could come into play
E) If 30451 is taken out, BankNifty could rise to 30538-570 / 30625 & 30690-718
F) Break of 29327 could trigger a move lower to 29240 / 29156 & 29090-71
G) Sustaining above 30718, the auction can tag higher levels of 30801 / 30875-890 & 30960-977
H) Staying below 29071, BankNifty can probe down to 28985-970 / 28900 & 28835-815

BNF (Weekly Profile)
30081 [ 30958 / 29667 ]

BNF also gave a huge gap up of 900+ points on Monday but changed from imbalance to balance leaving a nice Gaussian profile for the week with a prominent POC at 30224. Value for the week was higher at 30024-30224-30568 but the auction could not sustain the new highs of 30957 and has closed around the weekly VAL with a low volume zone from 30280 to 30470 which will be the reference on the upside above the prominent POC of 30224. On the downside, immediate support would be at 30024 and a break of this level on volumes could bring a move lower to 29538 & 29100 in the coming week.