24 Aug ’23 Post Mortem on BankNifty, Bulls have the upper hand🐂
BankNifty Weekly Analysis
Between the last expiry and today, BankNifty has gained 595pts ~ 1.36%. This is exactly why I said banknifty works as a leading indicator to detect trend changes. If you notice carefully the outperformance has started in BN, not quite in N50 (up only 0.17% weekly). And in the turn of events today, BN held its ground - cheers for that !
BankNifty Daily Analysis
Today’s price action was action packed just like Nifty’s. If you are an options trader a simple glance at the OTM premiums will help you understand what I am trying to say. Since we had a gap-up opening an implosion in implied volatility followed which killed the options premium.
Once we hit the day’s high 44949 @ 09.45 and the reversal started - the options premiums (OTMs) started jumping unusually. And what followed was a strong profit taking I must say. We fell 513 pts ~ 1.14% from the HOD to the LOD today. The intensity of the fall 1.10% was the same as that of Nifty but a higher gap-up combined with a climb to the high of the day gave banknifty a better closing than expected.
BN closed flat at 0.04% compared with N50 which fell 0.29%. Also on the 1hr TF banknifty is still bullish as the falling wedge pattern is untouched. As long as it stays this way, the momentum will pick in BN and a breakout will play out.
On the other hand if we get into the falling wedge pattern even after the convergence, it results in an immediate support breach which is quite bad news for the bulls. Looking at the performance this week - the trend should favor the bulls wherein the Nifty bulls could play the catch-up. I prefer to maintain my bullish stance for tomorrow and will be forced to go directly to bearish if 44068 is taken out on the hourly candle.
Between the last expiry and today, BankNifty has gained 595pts ~ 1.36%. This is exactly why I said banknifty works as a leading indicator to detect trend changes. If you notice carefully the outperformance has started in BN, not quite in N50 (up only 0.17% weekly). And in the turn of events today, BN held its ground - cheers for that !
BankNifty Daily Analysis
Today’s price action was action packed just like Nifty’s. If you are an options trader a simple glance at the OTM premiums will help you understand what I am trying to say. Since we had a gap-up opening an implosion in implied volatility followed which killed the options premium.
Once we hit the day’s high 44949 @ 09.45 and the reversal started - the options premiums (OTMs) started jumping unusually. And what followed was a strong profit taking I must say. We fell 513 pts ~ 1.14% from the HOD to the LOD today. The intensity of the fall 1.10% was the same as that of Nifty but a higher gap-up combined with a climb to the high of the day gave banknifty a better closing than expected.
BN closed flat at 0.04% compared with N50 which fell 0.29%. Also on the 1hr TF banknifty is still bullish as the falling wedge pattern is untouched. As long as it stays this way, the momentum will pick in BN and a breakout will play out.
On the other hand if we get into the falling wedge pattern even after the convergence, it results in an immediate support breach which is quite bad news for the bulls. Looking at the performance this week - the trend should favor the bulls wherein the Nifty bulls could play the catch-up. I prefer to maintain my bullish stance for tomorrow and will be forced to go directly to bearish if 44068 is taken out on the hourly candle.
