PostMortem on BankNifty Today & Analysis of 10 JAN 2023

Jan 10, 2023

BANKNIFTY fell 1.33% ~ 568 pts today, but the option prices were behaving like we had a 5% fall intraday.
Yeah the intensity of the fall was quite strong, but the level in which options premium jumped - its quite hard to believe. What i feel is the Finnifty expiry on tuesday is creating unwanted speculation in Banknifty. This can be proved right if tomorrow we have a contradicting move.
Lets look at the price action today - BN opened at 42642 just above the SR level of 42573. The first candle took out this SR and the selling was so intense that 487pts was taken out in 20mts. 
Maybe this would have triggered the massive CE options writing that snowballed the effect. BN went ahead and broke the next support of 41940 at 12.50. Right after this we had our first pull back.
The 2nd leg which started at 13.55 looked dangerous at 14.25 but did not fall further. The last 45mts rally ensured the SR level is now breached via resistance. 
So if we look at the day's chart we did not have even a 1 support break conclusively. Yesterday we did discuss the possibility of a breakdown in Indian markets if US is not rallying, esp when FIIs are positioned on the sell side.

If you go by the levels US markets closed on Friday - SPX 2.28%, NDQ 2.78% we should have started much more strongly…banknifty.medium.com

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Among the bank nifty components
HDFCBANK fell quite strongly from open till 10.25 (consecutive red candles). The next 5 hours was spent at this level only
ICICIBANK fell much deeper, the first leg of fall ended only at 14.35 after which we had a minor pull back.
SBIN too had deep cuts today, the first leg of fall till 12.45 and then a recovery till EOD
AXISBANK relatively did not fall that much, but the first leg of fall was not arrested till 14.25, the recovery till close ensured that cuts were not that bad.
KOTAKBANK had brief recovery periods till 14.25, 2 precisely. So the fall was slower comparing SBI and HDFCBk
INDUSINDBK was the lone wolf fighting in green today, up 0.73% - the price moves were unbelievable

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The 15mts and 1hr chart has now confirmed the price action of 9th Jan stands negated.
We have a lower high formation in 15mts, but no clarity in 1hr until the next support at 41629 is taken out.

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