Analysis and Trade Plan - 24 June 2019
On Thursday, long positions were added to Bank Nifty, but on Friday we came into severe selling pressure because of Iran shooting down US drone.
Technically, Nifty and Bank Nifty on daily and intraday charts is in sideways territory.
Future data is inconclusive right now. There was long buildup on Thursday but move on Friday subdued it.
PCR for Nifty and Bank Nifty is at 1.08 and 1.09 respectively but if one closely looks at Option data then there was significant call writing for both the indices.
Mike Pompeo visit to India ahead of meeting with Trump is hopeful of easing some tensions. Analysing the comments of American Diplomats, it is speculated that America wants a deal badly with China at G-20 summit. So there is a hope that there might be some positive news coming.
Amid US-Iran tensions, crude oil shot up above $65 and INR is trading at ₹69.61 which is not a worry right now. Any flare up to ₹70 levels for both is harmful for Indian Economy as it escalates fiscal deficit.
When Nifty crossed 11800 and Bank Nifty crossed 30700, I was pretty sure that we have changed the trend but it failed to sustain.
I hit a single bullish stoploss on Friday and then went long again as price was resisting downside.
Looking at SGX Nifty right now, we may open a little up. My positions yesterday are doing fine and I will cover my stoploss.
On the upside, I am looking at 11850 and 30800 on Nifty and Bank Nifty respectively. Failure to cross, I am looking at crucial support at 11600 and 30500/30200.
If we again face resistance to move up today, then I will be doing strangles.
Rohit Katwal
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