PostMortem on BankNifty Today & Analysis of 24 NOV 2022 - Expiry
Bank nifty broke out and made an all time high of 43163 today. The opening was at 42838 negating yesterday's fake price move from 15.00 to close.
Notice how yesterday's rally continued with the yellow encircled region. Today's open and forenoon trade was in perfect alignment with the rally that started yesterday.
Since its a breakout rally - the momentum was gaining strength and the final 45mts of today's trade is proof of that. Before that BN was in a range a narrow one and the monthly expiry was nothing unusual.
But the last 45mts gave some wings to the premium eventhough it was the closing minutes.
43000 CE went from 9.35 to 89.75 between 14.47 and close today, closed in the money with a final value of 76.
The reverse is also true, 43000 PE went from 111.9 to 0.05 between 14.47 to close.
When the VIX is near the lows ~ 13.47, implied volatility is low - the best option is to go with option buying (obviously we need a trend to make a killing).
Personally i wish to stay away from directional trades right now, prefer to execute arbitrage trades. The Euphoria in the market is now at all time highs - just as the markets are. So there could be fake moves or wild swings with no accompanying fundamental reasons.
All time highs are not good levels to enter with a purchase intent, because if the market reverses direction - you may end up holding something for years to come.
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Of the Bank nifty components, a common pattern is the last 45mts rally among HDFCBank, SBI, Axis and Kotak.
HDFC Bk had a nice start and then it built on the gains, strong buying momentum towards the end
ICICI had a relatively smoother slope, no pullback or consolidation intraday - just buying
SBI started strong, went underwater and then the last 45mts ensured it ended the day with gains.
AXIS had a similar chart like SBI, but the last 45mts gave it extra wings - the slope was approx. 80 to 85 degree
Kotak was gradually fading underwater - but the last 45mts ensured it closes in the flattish territory.
Indus Ind had a falling graph after a positive open. Took support at the Prev. close and final close was in positive territory. The final 45mts rally did have no effect on IndusInd.
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SPX vs Bank nifty - the spread is now at +6.32% vs 26.99%. US market will be closed today so we will not have any special macro related moves today.
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15mts vs 1hr - Notice the clear breakout in the 15mts TF. Whereas its depicted as strong momentum in 1hr TF.
Notice how yesterday's rally continued with the yellow encircled region. Today's open and forenoon trade was in perfect alignment with the rally that started yesterday.
Since its a breakout rally - the momentum was gaining strength and the final 45mts of today's trade is proof of that. Before that BN was in a range a narrow one and the monthly expiry was nothing unusual.
But the last 45mts gave some wings to the premium eventhough it was the closing minutes.
43000 CE went from 9.35 to 89.75 between 14.47 and close today, closed in the money with a final value of 76.
The reverse is also true, 43000 PE went from 111.9 to 0.05 between 14.47 to close.
When the VIX is near the lows ~ 13.47, implied volatility is low - the best option is to go with option buying (obviously we need a trend to make a killing).
Personally i wish to stay away from directional trades right now, prefer to execute arbitrage trades. The Euphoria in the market is now at all time highs - just as the markets are. So there could be fake moves or wild swings with no accompanying fundamental reasons.
All time highs are not good levels to enter with a purchase intent, because if the market reverses direction - you may end up holding something for years to come.
---
Of the Bank nifty components, a common pattern is the last 45mts rally among HDFCBank, SBI, Axis and Kotak.
HDFC Bk had a nice start and then it built on the gains, strong buying momentum towards the end
ICICI had a relatively smoother slope, no pullback or consolidation intraday - just buying
SBI started strong, went underwater and then the last 45mts ensured it ended the day with gains.
AXIS had a similar chart like SBI, but the last 45mts gave it extra wings - the slope was approx. 80 to 85 degree
Kotak was gradually fading underwater - but the last 45mts ensured it closes in the flattish territory.
Indus Ind had a falling graph after a positive open. Took support at the Prev. close and final close was in positive territory. The final 45mts rally did have no effect on IndusInd.
---
SPX vs Bank nifty - the spread is now at +6.32% vs 26.99%. US market will be closed today so we will not have any special macro related moves today.
---
15mts vs 1hr - Notice the clear breakout in the 15mts TF. Whereas its depicted as strong momentum in 1hr TF.