PostMortem on BankNifty Today & Analysis of 11 MAY 2023 expiry
Weekly Expiry Analysis
From the 4th of May till 11th,
BANKNIFTY
has fallen 0.3% ~ 131pts. Headline does not really indicate what went behind.
We fell 1028pts in 1 single day i.e. 5th and then scaled back 870pts in the remaining 4 days. How can I not credit the bulls? You might be bored with me praising the bulls everytime - sadly that is the reality. The bears are really unable to move the needle, this week I seriously thought we will take out the 42576 session - but that did not happen!
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Today's Analysis
Would you believe the gap-up open of 43535 today? We hit the same level as of 04 May on which
BANKNIFTY
had made an interim top. Needless to say the 5th May selling on HDFC-HDFCBK news took out some gains, but we have bounced back quite strongly.
That gapup stands as an anomaly, otherwise the price action is perfect, showing a higher-high formation. And then we had a flattish session afterwards.
From an expiry standpoint we did not have big movements (unusual), but we had 2 or 3 intense volatility surges even with a flattish movement (again unusual). The IV surge helped the options premium spike 2 or 3 times giving excellent opportunity to traders today.
Example 42000 PE which was OTM by 1500pts ~ 3.4% away from strike had 2 swings. 1st one from 09.30 to 10.30 where its premium surged 99% and then 13.10 to 13.48 where it surged 67%. Did the market make any abrupt move during that time - absolutely not.
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15mts are still having a minor bullish tone, but it will quickly fade out if new highs are not made. Are the bulls tired after a long run - seems like that. Nearest support is still 43253.
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1hr is more bullish than 15mts TF thats because the trailing price action shows strong upwards momentum. It also has a vulnerability to form a double top at 43750 levels - but for that we need some bad news. The only bad news we can expect in May is the Karnataka elections results!
From the 4th of May till 11th,
BANKNIFTY
has fallen 0.3% ~ 131pts. Headline does not really indicate what went behind. We fell 1028pts in 1 single day i.e. 5th and then scaled back 870pts in the remaining 4 days. How can I not credit the bulls? You might be bored with me praising the bulls everytime - sadly that is the reality. The bears are really unable to move the needle, this week I seriously thought we will take out the 42576 session - but that did not happen!
---
Today's Analysis
Would you believe the gap-up open of 43535 today? We hit the same level as of 04 May on which
BANKNIFTY
had made an interim top. Needless to say the 5th May selling on HDFC-HDFCBK news took out some gains, but we have bounced back quite strongly. That gapup stands as an anomaly, otherwise the price action is perfect, showing a higher-high formation. And then we had a flattish session afterwards.
From an expiry standpoint we did not have big movements (unusual), but we had 2 or 3 intense volatility surges even with a flattish movement (again unusual). The IV surge helped the options premium spike 2 or 3 times giving excellent opportunity to traders today.
Example 42000 PE which was OTM by 1500pts ~ 3.4% away from strike had 2 swings. 1st one from 09.30 to 10.30 where its premium surged 99% and then 13.10 to 13.48 where it surged 67%. Did the market make any abrupt move during that time - absolutely not.
---
15mts are still having a minor bullish tone, but it will quickly fade out if new highs are not made. Are the bulls tired after a long run - seems like that. Nearest support is still 43253.
---
1hr is more bullish than 15mts TF thats because the trailing price action shows strong upwards momentum. It also has a vulnerability to form a double top at 43750 levels - but for that we need some bad news. The only bad news we can expect in May is the Karnataka elections results!
