Yesterday we started discussing on the habit of NSE:BANKNIFTY taking out the support & resistance via gaps. Thats what happened today also. We opened gap up at 42994 above the resistance level of 42888. This was the same resistance level that had a breakout failure yesterday, so today we took that out in open. The 09.30 candle was pretty strong and i almost thought we may have a breakout rally, but it was fake. And bank nifty started falling gradually. The chart may show that the fall was big, but it wasnt. A 0.81% drop from HOD to 42736 at 12.00. Then a brief flattish move and the 2nd leg start at 12.55 to 13.55 a fall of 0.48%. Bank nifty turned even before the support level of 42573. So finally we ended the day at a level much closer to yesterday's close. Today's price action would also have taken into consideration the FINNIFTY expiry - i couldnt really make that out correctly because we have the bank nifty expiry tomorrow. Usually when there is a gap of 1 day in between these 2 expiries its quite simple to find out if there are specific positions taken just to create a fake move & mint money. If we look at the 15mts chart, the gaps are helping bank nifty to scale upwards, so there is a slight positive bias. For me the 1hr TF looks like the cup & handle wherein the handle came first. Chart in general is not giving us a directional bias as the support & resistance zones are quite active.
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Among the bank nifty components: NSE:HDFCBANK had another up day of which the majority of gains coming in the opening 2 candles. This pattern has now repeated for the last 3 days. 7.68% rise from the low on the QoQ results day NSE:ICICIBANK ended the day near the flat line but the price action was largely negative, mostly because the opening was gap up & the chart pattern played out that way. Only for a brief period of time ICICI went below water but the moves would have prompted a lot of traders to go short. A 1.47% traded range b/w HOD to LOD NSE:SBIN had a good bearish chart pattern today. Opening was gap up but from there it was a steady single fall with almost nil pullback until 13.55. A 1.9% trade range today NSE:AXISBANK was reacting to the QoQ results, it would have gone down due to positioning or profit taking as the results were quite good. The opening candle had a volume of 3.92M. A trade range of 3.33% which was hit in a single leg by 11.15. NSE:KOTAKBANK also had a bearish day today, mostly in 1 leg and then a brief pull back at 14.05. The trade range was 2.46% much amplified due to the gap up opening. NSE:INDUSINDBK held its ground today, perfectly taking support at the flat line. This same zone has now provided support for the last 3 days which is quite interesting.
To view the 4 charts discussed today, contact @viswaram