PostMortem on BankNifty Today & Analysis of 04 JAN 2023
Probably you would feel it repetitive when i said the nifty and bank nifty made moves when the US markets were on holidays.
Look what happened today with bank nifty - we have negated the 2 day's of price action ie. 02 Jan and 03 Jan. Which means we have closed today at the same value as of 30th Dec
The child was having a nice time when the mom was on leave, now that she is back & has grounded him !
Lets now analyze the 5mts TF - BN opens at 43417 and makes a move up in the opening 10mts - HOD 43578 at 09.25. This would be the poor participants who would have taken a long position based on yesterday's price action.
And then the first leg of fall from 09.25 to 12.10 a fall of 670pts ~ 1.54%. The bank nifty's fall happened sooner than my marked SR level of 42888.
There was a brief pull back rally from 12.15 to 14.10 almost a 38.2% retracement Fibonacci - notice i have marked the FIB levels based on the HOD and the low formed at 12.10 because that's where it reversed.
The 2nd leg of rally had a higher intent but we ran out of time. Bulls need not be that much worried because the first level of support is still not breached.
What may have happened would be the after effect of the 2 day unchecked rally. Today's price move in US & tomorrow's expiry may set the tone for further action.
check the image above, 49000 CE was traded for 90.52 lakh qty, 46000 CE 1.48 crores, 45000 CE 3.15 Crores, 43000 CE 11.8 Crores. The option trading participation & volumes picked up when the market started moving.
Even there was a spike in the option premiums of PE at 12.07 - see 8 charts below - even the far OTM PEs prices almost went up 150%
This sets the stage for a wonderful expiry tomorrow. If US market falls today then we can expect further corrections here due to the domino effect created by the options positioning (mostly expiry related).
I am skipping the bank nifty component analysis as today's price action would be broad based!
Look what happened today with bank nifty - we have negated the 2 day's of price action ie. 02 Jan and 03 Jan. Which means we have closed today at the same value as of 30th Dec
The child was having a nice time when the mom was on leave, now that she is back & has grounded him !
Lets now analyze the 5mts TF - BN opens at 43417 and makes a move up in the opening 10mts - HOD 43578 at 09.25. This would be the poor participants who would have taken a long position based on yesterday's price action.
And then the first leg of fall from 09.25 to 12.10 a fall of 670pts ~ 1.54%. The bank nifty's fall happened sooner than my marked SR level of 42888.
There was a brief pull back rally from 12.15 to 14.10 almost a 38.2% retracement Fibonacci - notice i have marked the FIB levels based on the HOD and the low formed at 12.10 because that's where it reversed.
The 2nd leg of rally had a higher intent but we ran out of time. Bulls need not be that much worried because the first level of support is still not breached.
What may have happened would be the after effect of the 2 day unchecked rally. Today's price move in US & tomorrow's expiry may set the tone for further action.
check the image above, 49000 CE was traded for 90.52 lakh qty, 46000 CE 1.48 crores, 45000 CE 3.15 Crores, 43000 CE 11.8 Crores. The option trading participation & volumes picked up when the market started moving.
Even there was a spike in the option premiums of PE at 12.07 - see 8 charts below - even the far OTM PEs prices almost went up 150%
This sets the stage for a wonderful expiry tomorrow. If US market falls today then we can expect further corrections here due to the domino effect created by the options positioning (mostly expiry related).
I am skipping the bank nifty component analysis as today's price action would be broad based!
