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Technicals & market outlook for 25MAR2021 monthly expiry

Global factors to look at:
• US FED & England Central Banks kept interest rates unchanged.
Gold has entered bear market with correction of 20% from ATH.
• Brent Crude is trading near 62.4 after 10% correction from top.
• US 10Yr bond yield > 1.7. Despite FED tap on, its keeps rising
• DollarIndex is near 92 mark. Cooled off a bit in last 5 days
• Dow/ DAX / S&P500 hits new ATH in last week. Nasdaq recovered well
• All global ETF's down by 10% except "iShares Trust India ETF"

Technical Outlook: Sideways to #Bearish
BankNifty enters correction phase & down by 10.86% from ATH
BankNifty brokedown below the VAL & neckline support of 34485.
Nifty still holding the VAL & major neckline support of 14522
• RSIStairs < 45 looks bullish in both 75M/1D in both indices
• Mean.Revert & PVT indicators given sell signal in both indices.
ADX (DI) given bearish cross in both Indian benchmark indices.
BankNifty & Nifty combined open interest is alarmingly high
• Looking at the COI data move can be big causing a stampede .
IndiaVIX collapsed by 21% from 26.41 to 20.75 in 3 sessions
• Very low PCR indicates oversold markets. May give some bounce.
• Above data points indicates, Nifty is waiting a range BO.

Additional data points:
BankNifty has already given range BO, Nifty on boarder line.
FII selling have reduced significantly in last 3 trading days
FII option buying figures are high. Could be to hedge longs
• Future net long positions have dropped since 26th February
• Short selling restriction imposed by SEBI is still in force.

Volume profile & trade plan:
During the last weekly expiry Nifty failed to breakout above 15318 levels and seen strong profit booking and closed at lowest point breaking the lower range of smaller TF VAL 14944. As per daily volume profile value area is placed within 15249(VAH) 14457(VAL) for Nifty. Major trading activities seen within this range with high volume and rising combined open interest. Nifty trading below 20&50 DEMA and has made an DoubleTop pattern whose confirmation is pending below 14522. So breakdown below neckline will open copy book target of 13667 (next swing low & 38.2% Fib zone). And on upside critical levels to watch out for is 14862/14940. Basis the daily charts would like to go with hedged short trades for this weekly expiry. Will defend upside moves by selling OTM PE.

BankNifty broken down below the VAL 34485. It may remain range bound to bearish with an possible downside target of 32880. 34865 is a key reference level on upside. Markets being oversold, you may see a dead cat bounce. So, stay hedged, stay protected.
Disclaimer: All these stock ideas or trade updates shared here are for educational purpose only and completely non-advisory in nature. I am not a SEBI registered analyst and strongly recommend people not to trade in NSE / BSE / MCX market basis this ideas. Objective of posts is to educate and help members learn technical analysis and hedging techniques from my personal trade picks to reduce the risk per trade and save yourself from bigger losses.

All these trade picks are selected using technical analysis and price action (VSA MomentumInvest Trading Setup) and for my own trading purpose only. Technical indicators are lagging and may generate false buy/sell signals. Market is supreme and my views may go horribly wrong. Please don't consider these trade ideas as trading recommendations. You may consider it for learning or at max use it for paper trading. Strictly avoid it for trading using real money. I am not responsible for any kind of profit and losses arising out of the above calls. Stock market trading and investment is subject to market risks. Contact your financial advisor before taking trades (or trade at your own risk).

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