Sometimes God is on your side and it is heartening to see that levels you had given were observed and followed. On Friday, Nifty reversed DOWN from Selling area as I had shown and Banknifty reversed UP from Buying Area. So there were 2 trades that gave some profits. I hope people who read the post were able to take at least one of those. If not, please let me know why you missed, if you want.
The macroeconomic data coming in does ring alarm bells. IIP data showed contraction of 1.1% (meaning -1.1%, read 'negative 1.1%'), lowest in 81 months and first contraction since June 2017. Last year August, it was at 4.8%. The three key constituents of IIP are manufacturing, electricity and mining. Manufacturing contracted by 1.2%, electricity contracted by 0.9% and mining increased by 0.1%. Production of capital goods- barometer of investment- contracted by 21%. Other data too does not paint a growth- picture.
Passenger vehicle sales in India slumped by 23.7% in September- eleventh straight month of declines. That some of this data must be already discounted in market is understood, but absence of any strong positive trigger will push stock markets downhill rather than up. Let's examine market data.
1) For a change, on friday, FIIs were Net Buyers by 750 Crs and DIIs were Net Sellers by 703 Crs according to provisional data. The final data for Thursday (previous day, expiry day) shows that FIIs were Net sellers in all three categories- in Equity by 133 Crs, in Index futures by 685 Crs and in stock futures by 227 Crs. Slowly slowly these FII & DII figures will now become redundant as both are now buying and selling depending on their own perspective of markets and economy on day to day basis rather than in only one direction.
2) Option chain data- On PUT side, highest total OI (11.85 lakhs) and highest Put writing ( 5.13 lakhs) is observed at 11000 strike and 2nd highest total OI (11.10 lakhs) and Put writing ( 5.00 lakhs) is observed at 11200 strike. So for tomorrow, 11200 looks OK support. On CALL side, highest total OI (14.69 lakhs) and highest Call writing (6.75 lakhs) both are seen at strike price of 11400. So 11400 looks Ok resistance for tomorrow.
3) Charts- On daily chart, Nifty finished as a base-like candle with higher high and lower low than previous day's candle. It shows terse fight between bulls and bears and increasing volatility. It did went below the 20 & 200 DEMA lines but managed to close above it. So effectively, Friday's low and high are defining the range for next few days' movement. I have marked the buying and selling areas that I could spot for tomorrow's trade on 15 min chart.
All the best. Happy trading.
The macroeconomic data coming in does ring alarm bells. IIP data showed contraction of 1.1% (meaning -1.1%, read 'negative 1.1%'), lowest in 81 months and first contraction since June 2017. Last year August, it was at 4.8%. The three key constituents of IIP are manufacturing, electricity and mining. Manufacturing contracted by 1.2%, electricity contracted by 0.9% and mining increased by 0.1%. Production of capital goods- barometer of investment- contracted by 21%. Other data too does not paint a growth- picture.
Passenger vehicle sales in India slumped by 23.7% in September- eleventh straight month of declines. That some of this data must be already discounted in market is understood, but absence of any strong positive trigger will push stock markets downhill rather than up. Let's examine market data.
1) For a change, on friday, FIIs were Net Buyers by 750 Crs and DIIs were Net Sellers by 703 Crs according to provisional data. The final data for Thursday (previous day, expiry day) shows that FIIs were Net sellers in all three categories- in Equity by 133 Crs, in Index futures by 685 Crs and in stock futures by 227 Crs. Slowly slowly these FII & DII figures will now become redundant as both are now buying and selling depending on their own perspective of markets and economy on day to day basis rather than in only one direction.
2) Option chain data- On PUT side, highest total OI (11.85 lakhs) and highest Put writing ( 5.13 lakhs) is observed at 11000 strike and 2nd highest total OI (11.10 lakhs) and Put writing ( 5.00 lakhs) is observed at 11200 strike. So for tomorrow, 11200 looks OK support. On CALL side, highest total OI (14.69 lakhs) and highest Call writing (6.75 lakhs) both are seen at strike price of 11400. So 11400 looks Ok resistance for tomorrow.
3) Charts- On daily chart, Nifty finished as a base-like candle with higher high and lower low than previous day's candle. It shows terse fight between bulls and bears and increasing volatility. It did went below the 20 & 200 DEMA lines but managed to close above it. So effectively, Friday's low and high are defining the range for next few days' movement. I have marked the buying and selling areas that I could spot for tomorrow's trade on 15 min chart.
All the best. Happy trading.