PostMortem on BankNifty Today & Analysis of 01 DEC 2022 Expiry
The frustration i had trading yesterday was a blessing for today, its because technically i felt bank nifty is showing bearishness and was looking out for bearish opportunities. The last 30mts rally on 30th Nov changed my opinion.
Its not that i became bullish, but that i decided not to have a bias. Bank nifty opened mega gap up at 43512 (new all time high) and made a red hammer candle with a long wick. From there it was a gradual fall till 13.15.
What happened between 13.20 to 13.55 was quite a mirror image to what we had between 15.00 to 15.25 yesterday. We had a drop of 302pts today compared with the 312 pts that gained in the same interval.
I am inclined to look at this as unwinding of the build up we had yesterday - but the volumes on the bank stocks did not surge equivalently. So it could even be expiry related position unwinding.
Looking at monday 28th Nov, the bank nifty options interest suggested we might even have a close below 43000 - read here. But since the macros changed after that (Fed chair Powell's talk about reducing the rate of interest hike sending S&P500 up 3.1%, Nasdaq 4.58% and DowJones almost into a bull market) the options writers would have been worried that final close will not be below 43000.
This 20 to 30mts gave a good opportunity for them to exit their position even without booking a loss as the 43000 CE did drop in value between 28th and today.
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Of the bank nifty components :-
HDFC bank had a positive day the open and close price almost nearby. The chart pattern was a minor negative slope.
ICICI Bank had a deep negative slope and the final close was in red.
SBI opened gap up, went underwater and then reversed direction by 11.25. The final chart pattern is positive
AXIS had a gap up, the a quick fall and then a gradual positive slope. Final close was flattish.
Kotak started the day positive, went underwater by 13.10, almost hit LOD by 13.55 and then a small pull back till 14.35. Final chart pattern was negative
IndusInd bank prices was jumping up and down wrt flat line. Final close was positive whereas chart pattern formed as neutralish.
The launch of CBDC (Central bank digital currency) e-Rupee would have created change in fundamentals that are yet to be priced in. CBDC in the long run are bearish for the banks as they lose control to create currency via debt (according to me). But for a big country like India wherein the majority of people still dont have a bank account - the impact may take years to be felt.
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15mts TF had a negative price action today mainly because of the mega gap up.
1hr TF is looking bullish as the gap up looks inline with the chart slope.
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New Support & Resistance lines added at 43253, 42883 & 42576
Its not that i became bullish, but that i decided not to have a bias. Bank nifty opened mega gap up at 43512 (new all time high) and made a red hammer candle with a long wick. From there it was a gradual fall till 13.15.
What happened between 13.20 to 13.55 was quite a mirror image to what we had between 15.00 to 15.25 yesterday. We had a drop of 302pts today compared with the 312 pts that gained in the same interval.
I am inclined to look at this as unwinding of the build up we had yesterday - but the volumes on the bank stocks did not surge equivalently. So it could even be expiry related position unwinding.
Looking at monday 28th Nov, the bank nifty options interest suggested we might even have a close below 43000 - read here. But since the macros changed after that (Fed chair Powell's talk about reducing the rate of interest hike sending S&P500 up 3.1%, Nasdaq 4.58% and DowJones almost into a bull market) the options writers would have been worried that final close will not be below 43000.
This 20 to 30mts gave a good opportunity for them to exit their position even without booking a loss as the 43000 CE did drop in value between 28th and today.
---
Of the bank nifty components :-
HDFC bank had a positive day the open and close price almost nearby. The chart pattern was a minor negative slope.
ICICI Bank had a deep negative slope and the final close was in red.
SBI opened gap up, went underwater and then reversed direction by 11.25. The final chart pattern is positive
AXIS had a gap up, the a quick fall and then a gradual positive slope. Final close was flattish.
Kotak started the day positive, went underwater by 13.10, almost hit LOD by 13.55 and then a small pull back till 14.35. Final chart pattern was negative
IndusInd bank prices was jumping up and down wrt flat line. Final close was positive whereas chart pattern formed as neutralish.
The launch of CBDC (Central bank digital currency) e-Rupee would have created change in fundamentals that are yet to be priced in. CBDC in the long run are bearish for the banks as they lose control to create currency via debt (according to me). But for a big country like India wherein the majority of people still dont have a bank account - the impact may take years to be felt.
---
15mts TF had a negative price action today mainly because of the mega gap up.
1hr TF is looking bullish as the gap up looks inline with the chart slope.
---
New Support & Resistance lines added at 43253, 42883 & 42576
