Analysis and Trade Plan - 21 January 2019

I took a trade on Friday and forgot that HDFC Bank results were due. Although the position was for bullish, I exited as I did not want to trade in uncertainty. Results of Kotak Bank are also due Monday.


Bank Nifty

Technically:

  • We are bullish on daily charts.

  • We are consolidating on 2 hours and 30 minutes chart.

  • We are forming a triangle formation and breakout to either side is expected. Depending on the good results of HDFC Bank, it can be to the upside.

  • We witnessed some unwinding but not by much volume.

  • When trend is down, we have very swift bear moves. When trend is up we have very swift bullish moves. And currently bear movements are more of a sideways movement and one can expect bullishness and it can be swift.

  • 27300-27400 is where support is coming. 27500 to 27600 has become resistance zone. On Monday, we may open to the upside. If it holds, I would like to add bullish trades.

Data Analysis:

  • We are sideways as max pain is struggling around 27400-27500.

  • PCR at 0.94 is slowly getting bullish. We dropped to 0.63 at one time, but it slowly again inched higher which means there is not much of negative sentiment. Its just sideways.

  • I have started analyzing PCR more closely and more I analyse, more it fascinates me.

  • Daily total PCR is moving up. Daily OTM/ATM PCR has moved down. So We need to be bullish on overall daily PCR, plus OTM/ATM PCR and I can call it a bullish consolidation. Right now we are in sideways movement with bullish bias.

  • I will like to take a calendar with bullish bias. Below 27350, we may touch 27100 again.


Nifty

Technically:

  • Nifty has been forming Hanging Man for the last three days. Its like a fight between bears and bulls. Every time it makes a low, it is held back up.

  • It is also forming an ascending triangle and testing upper side for the 5th time. It has all the components of breaking up.

  • Next barrier we have at 10975. We need to cross 10930 decisively.

  • If we surrender 10850, I will go short.

Data Analysis:

  • India Vix on average is still below 16. If we rise tomorrow, then India Vix will come down. I have received a bullish signal from Vix few weeks back and we are bullish since then. Right now it is at a retracement which is a good place to be bullish.

  • Max pain has started to move up and is at 10900.

  • PCR at 1.32 is bullish.

  • We had call unwinding at higher levels yesterday. There was no put writing also.

  • Cumulative PCR which matters is at 1.08 against total of 1.32 on Nifty.

  • OTM/ATM PCR right now is at 1.32 which seems kind of bullish.

  • Overall seems bullish with sideways bias. We need decisive break of 10930.

News Factor:

  • SGX Nifty is up 25 points suggesting a normal to little gapup opening.

  • Rupee should start to stabilize at current levels.

  • Crude Oil is near $62 levels.

  • Trump still negotiating on wall.

  • Apart from Kotak Bank results during market hours and reaction to already declared HDFC Bank, there is no major news.

Rohit Katwal



24 views

Recent Posts

See All