Rangebound How Long ?: Weekly Market Analysis : Aug 2 2020

 

• Weekly ‘hammer’ candle on Nifty &  spinning top” for  Bank Nifty both could at times turn out as reversal.

• Nifty had another V shape movement last week fall 2.3% from top and recovered most of it while Bank nifty did the same falling 2.5% but could not recover much of it(1.8%).

• Latest nifty daily candle looks like an inverse hammer while bank nifty latest candle is kind of spinning top both could at times signal reversal.

• Nifty & Bank nifty both continue the Bollinger band volatility contraction within the narrow range.

• Nifty once again facing resistances faced earlier at 15850/15950 along with the rounding number psychological level of 16000.

• Previous swing low levels of  15500 - 15650 is support zone and then 15250-15400 levels below also could act as support levels  and 15000 level is seen if that is broken.

• Bank nifty is taking support at previous support zone of 34300-34650 and resistances above are 35500/35950 and has further  previous resistances to clear 36500/37700.

• Nifty RSI momentum continue to be in sideways zones.However the medium to long term momentum is intact in bullish area,

• Last week the Nifty weekly bearish momentum divergence as anticipated pulled it back near to 15500 levels and now there is a bullish momentum positive reverse divergence that could pull it up to at least 15900 back .

• Bank Nifty momentum daily and weekly also continue to be in sideways  while monthly momentum  maintains to be in bullish zones.

• Nifty ADX trend indicator trend is in  bear zones falling and with less strength on daily but maintain trend bullishness on weekly and monthly timeframes.

• Bank nifty ADX trend indicator showing rising strength in the bearishness of trend on daily timeframes and weekly crossed over to bearish trend and monthly maintain the bullish trend.

• Open interest data for Nifty & Bank nifty showing a long unwinding based on the futures contracts.

• Highest options call writing for 01 July expiry is seen at 15900 with 15800 also seen having more writing while 15700  levels shows highest support point for nifty with 15800 support is close by.

• Bank-nifty options open interest data shows highest call writing at 35000 levels while highest put writing seen at 34500  levels that could act as support for the expiry

• Put call ratio for nifty accordingly is seen 0.81 which is not bullish while 0.74  for bank-nifty is also  not bullish.

• India VIX  move up 17%  and settle at 12.8 and continue to be low levels last week after a spike.

• The Nifty IV 12 is above HIV 8.7  and  IVP remaining 3  levels which is at the new low volatility regime. 

• IT sector index moved up ~3% last week and the bearish divergence seen weekly can not be negated.Therefore need slightly caution even though it is bullish.Dollar strength could be behind the bullishness.

• FMCG corrected 2.4%  last week with a W breakout failed and therefore need wait for the momentum catch up again.

• Metal had as anticipated the  bullish positive reverse divergence worked well and index shot up 10% last week doing a clear breakout.Now a bearish momentum exit in the up move but could be cautiously bullish.

• Auto sector fall more than 2.5 % last week and continue to be bearish with double top patterns forming on daily and weekly and momentum on daily in bearish zones.

• Pharma as anticipated weekly bearish momentum divergence that worked to bring a correction of 6% as target and later recovered most of it ,Now there is a weekly bullish momentum reverse divergence which could take it back to further up move.

• Last week FII sold> 8820 cr in cash.

• DII bought 8200 cr last that kept the market up last week

• The net longs on derivatives of FII/DII moved up last week.

• US markets formed small body red weekly candle on all major indices.

• Dollar Index corrected to near 1% or more at neckline resistance zone of W breakout pattern seen.

• Crude Oil increased  near 2% last week with no respite.

•  USD-INR currency pair was red forming a spinning top candle on weekly from top and  could be consolidating for a  reattempt to channel top resistance again next week

•  Gold formed a green candle last week and could continue bullishness heading to the channel top but with slow momentum.

• India VIX continue at  low 12.8 levels and any spike could benefit vega positive strategies on options like double calendar.

• Therefore Nifty calendar spreads hedged is always bad idea for coming week due to v shape moves often.

• Markets fall first & bounced back once again from the support zones similar to previous week with momentum continue sideways and trend bearish and Bollinger band indicate that 1 month long consolidation continue with not yet breaking out on either side. 

• Trend overall bias is bearish with caution especially since FII selling concern and bank nifty turning bearish more. Still the weekly bullish divergence give probably for up move also.

• India vix are at difficult low volatile levels for option traders both buyers and sellers and non directional trades are only to be thought.Will there be immediate mean reversion spike or will it remain at this for long is uncertain.

• Positional long trades would hold good until a clear signal of  breaking  of major support zones indicated earlier, there is no point in exiting or shorting as of now.

How far really is 16000? Weekly Market Analysis : July 26 2021

 

• Weekly bullish hammer candle on Nifty &  indecisive “doji” for  Bank Nifty.

• Nifty had a V shape movement last week fall 2.4% from top and recovered most of it while Bank-nifty did the same falling 4.5% but could not recover much of it(2%).

• Latest nifty daily candle is an indecisive doji while bank-nifty latest candle is bullish kind of hammer.

• Nifty & Bank nifty both continue the Bollinger band volatility contraction within the narrow range.

• Nifty once again facing resistances faced earlier at 15850/15950 along with the rounding number psychological level of 16000.

• Previous swing low levels of  15500 - 15650 is support zone and then 15250-15400 levels below also could act as support levels  and 15000 level is seen if that is broken.

• Bank-nifty facing resistance at 35000 and has 3 previous resistances to clear 36500/37700 and has 34300-34650 levels as next supports below.

• Nifty RSI momentum gave  up previous week bullishness and is back in sideways zones. However the medium to long term momentum is intact in bullish area,

• Nifty weekly bearish momentum divergence that could pull it back to 15450 levels is still work in progress halfway targets.

• Bank Nifty momentum daily gave up momentum gains of previous week and went sideways  current week and weekly momentum also  has slipped slightly into sideways zone . monthly momentum  maintains to be in bullish zones.

• Nifty & Bank Nifty ADX trend indicator gave up bullish trend of last week and has crossed over to bear zones areas on daily but maintain trend bullishness on weekly and monthly timeframes

• Open interest data for Nifty showing a long buildup and Bank-nifty showing short covering based on the futures contracts.

• Highest options call writing for 01 July expiry is seen at 16000 with 15900 also seen having more writing while 15000  levels shows highest support point for nifty with 15800 support is close-by.

• Bank-nifty options open interest data shows highest call writing at 35000 levels while highest put writing seen at 35000/34500  levels that could act as support for the expiry

• Put call ratio for nifty accordingly is seen 1.01 which is bullish while 0.94  for bank-nifty is not bearish.

• India VIX  moves 5%  and continue settle at 11.7 historic low levels last week.

• The Nifty IV 12.1 is above HIV 9.2  and  IVP remaining 0.4  levels 

• IT sector index showing a gravestone doji on daily top and the bearish divergence seen weekly can not be negated. Therefore need caution even though it is bullish. 

• FMCG is consolidating sideways last week forming a weekly doji and at  previous resistance zone and therefore need wait for the momentum catch up.

• Metal has the bullish positive reverse divergence seem to be working and market ended indecisive doji last week. Momentum on daily is slipped back to sideways from previous week bullish zones and need wait for momentum to get back.

• Auto sector continue to be bearish with double top patterns forming on daily and weekly and momentum on dail in bearish zones.

• Pharma forming a small body green candle and is bullish on all timeframes now but weekly has a bearish momentum divergence that could pull it back a bit on weekly basis.

• Last week FII sold> 5400 cr in cash.

• DII bought 5050 cr last that kept the market up last week

• The net longs on derivatives of FII/DII slipped down last week

• US markets recovered from a panic fall previous week and is green and moving up again this week.

• Dollar Index further strengthened at a major resistance zone.W breakout pattern seen.

• Crude Oil fall near 9% and later rebounded recovered most of it.

•  USD-INR currency pair fall near 1% from top and  could consolidate ot reattempt to channel top resistance again next week

•  Gold correct neat 2% last week and could continue bullishness heading to the channel top but with slow momentum.

• India VIX has fallen to lowest 11.7 levels and any spike could benefit vega positive strategies on options like double calendar.

• Therefore Nifty calendar spreads hedged is always bad idea for coming week due to v shape moves often.

• Markets fall &  bounced back once again from the support zones but momentum continue sideways and trend bearish and Bollinger band indicate that 1 month long consolidation continue with not yet breaking out on either side. 

• Trend overall bias is slight bullish with caution since weekly bearish divergence and FII selling concern.

• India vix are at difficult low volatile levels for option traders both buyers and sellers and non directional trades are only to be thought. Will there be immediate mean reversion spike or will it remain at this for long is uncertain.

• Positional long trades would hold good until a clear signal of  breaking  of major support zones indicated earlier, there is no point in exiting or shorting as of now.

Will the breakout sustain?: Weekly Market Technical Analysis : July 19 2021

 

• Weekly bullish candle on Nifty & Bank Nifty.

• Nifty has 5 higher high candle formation entire last week.

• Nifty & Bank Nifty broke out from previous resistance zone. Bank nifty broke out of a inverse head & shoulder neckline.

• Latest nifty daily candle hammer-on uptrend at resistance

• Bank nifty has a open=high candle pattern on daily bearish

• Nifty & Bank nifty both shows beginning of Bollinger band volatility expansion from earlier narrow range.

• Nifty nearer to a rounding number psychological level of 16000 and resistances can be expected.

• Earlie resistances now could act as support and levels of  15750 - 15900 are support zone and then 15500-15600 levels below acting good previous swing low supports and 15000 level are seen if that is broken

• Bank nifty has 3 previous resistances to clear 36500/37700 and has 34300-34650 levels as next supports below.

• Nifty RSI momentum climbed to bullish zones last week and retains it. Also the medium to long term momentum is intact in bullish area,

• Nifty weekly has a bearish momentum divergence that could pull it back to 15450 levels if it works out.

• Bank Nifty momentum daily climbed into bullishness but could not sustain it and slipped slightly back into sideways zone on  daily  .Weekly and monthly momentum  maintains to be in bullish zones.

• Nifty & Bank Nifty ADX trend indicator are in  bullish areas on daily, weekly and monthly timeframes

• Open interest data for Nifty showing a long unwinding and Bank nifty showing short buildup based on the futures contracts which is bearish.

• Highest options call writing for 01 july expiry is seen at 16200 with 16000 also seen having more writing while 15900  levels shows highest  support point for nifty with 15800 support is close by.

• Bank-nifty options open interest data shows highest call writing at 36000 levels while highest put writing seen at 35500  levels that could act as support for the expiry

• Put call ratio for nifty accordingly is seen 1.03 which is bullish while 0.71  for bank-nifty is not bullish.

• India VIX  fall more than 20%  to historic lowest levels of 10.5  and settled at 11.7 last week.

• The Nifty IV 11.6 is above HIV 6.9  and  IVP remaining 2  levels which is at the new low volatility regime. 

• IT sector corrected more than 2% and later gave up some of it  but bearish divergence seen weekly can not be negated. 

• FMCG is consolidating sideways last week forming a weekly doji and at  previous resistance zone and therefore need wait for the momentum catch up.

• Metal has the bullish positive reverse divergence seem to be working and market ended green last week. Momentum on daily is now in bullish zones and could expect a breakout.

• Auto sector formed a bearish inside bar and consolidating on daily and weekly and may take time to turn bullish again.

• Pharma moved up 2.5% last week and broke out into an all time high levels. but weekly has a bearish momentum divergence that could pull it back a bit on weekly basis. sector is bullish on all timeframes.

• Last week FII sold> 2500 cr in cash.

• DII bought 3200 cr last that kept the market up last week

• The net longs on derivatives of FII/DII moved up last week.

• India VIX has fallen to lowest 11.4 levels and any spike could benefit Vega positive strategies on options like double calendar.

• Therefore Nifty calendar spreads hedged is always bad idea for coming week due to v shape moves often.

• Markets broke out from major resistance zone but lost momentum end of week and Bollinger band started expanding while bank nifty need catch up with resistances, with the improved momentum and trend overall bias is bullish with caution since weekly bearish divergence and FII selling concern.

• India vix are at difficult low volatile levels for option traders both buyers and sellers and non directional trades are only to be thought of. Will there be immediate mean reversion spike or will it remain at this for long is uncertain.

• Positional long trades would hold good until a clear signal of  breaking  of major support zones indicated earlier, there is no point in exiting or shorting as of now.

Correction or Consolidation? : Weekly Technical Analysis : July 12 2021

 

• Weekly bearish spinning top candle on Nifty & gravestone Doji candle Bank Nifty.

• Nifty & Bank nifty shows a inverted V shape  ie moving up and then reversing last week on daily.

• Nifty& Bank nifty reversed from previous resistance zone.

• Nifty at a major previous swing low support zone and both indices at channel bottom.

• Latest nifty daily candle Doji-shows indecisiveness, 

• Bank nifty has a hammer  candle pattern on daily potential reversal up.

• Nifty & Bank nifty both has Bollinger band squeeze into narrow range and showing clear volatility contraction /consolidation.

• Nifty once again failed to conquer previous resistances tested tested multiple times of 15900 near an all  time high and rounding number psychological level of 16000 close by.

• It immediate support at  15600 and then 15500 levels below acting good previous swing low supports and 15000 level are seen if that is broken

• Bank nifty has 3 previous resistances to clear/35800/37700/36500 and has 34000-34500 levels as next supports below.

• Nifty RSI momentum has fallen further down and remain in sideways zone on  daily. However medium to long term momentum is intact in bullish area,

• Nifty daily both  bullish positive reverse divergences failed.

• Bank Nifty momentum daily continues to be in sideways zone and falling  .Weekly and monthly momentum  maintains to be in bullish zones.

• Nifty ADX trend indicator continue in  bearish areas on daily timeframe with flat strength while weekly and monthly trend remain bullish with flat strength 

• Bank nifty has ADX trend indicator crossed over back to bearish  zones  on daily timeframe. The trend continue to be in bullish side on medium & long term timeframes with flat strength.

• Open interest data for Nifty showing a long unwinding and Bank nifty showing short buildup based on the futures contracts which is bearish.

• Highest options call writing for 01 July expiry is seen at 16000 with 15800/15700 also seen having more writing while 15600  levels shows highest  support point for nifty with 15500/15000 support is close by.

• Bank-nifty options open interest data shows highest call writing at 36000 levels while highest put writing seen at 35000  levels that could act as support for the expiry

• Put call ratio for nifty accordingly is seen 0.66  which is not bullish while 0.74  for bank-nifty also is not bullish.

• India VIX  fall near 20%  to historic lowest levels of 11.1 and settled at 12/9 last week.

• The Nifty IV 12.8 is above HIV 7.4  and  IVP remaining 3.1  levels which is at the new low volatility regime. 

• IT sector corrected near 3% but continue with bullish divergence seen weekly with strength in momentum and trend on short/medium/long term charts. 

• FMCG also corrected 1% but continue bullish with momentum bullish divergence seen weekly and could regain momentum to move further up slightly dipped on short term momentum as of now.

• Metal did ok last week but still sideways on short term but medium to long term is bullish and so need wait till momentum pickup and breakout. Currently consolidating.

• Auto sector corrected 4% and lost momentum it gained last week and now is sideways in short / medium term and bullish only on long term.

• Pharma correct 2.5% last week and slipped back to sideways on daily but higher time frames are bullish and could breakout as discussed previous weeks

• Last week FII sold> 2000 crore in cash.

• DII also turned sellers last week after 14 days continuously in cash and sold all bought last week.

• The net longs on derivatives of FII/DII had dipped.

• US markets ended green last week and show hammer pattern on weekly indicating further up move.

• Dollar Index at resistance inverse happen up 92.1 level.

•  USD-INR currency pair at resistance near channel top a Doji on weekly but bullish divergence on weekly.

• Gold continue bullishness and at channel top but with slow momentum and any further moves could make it bullish.

• India VIX has fallen to lowest 12.9 levels and seems to remain at these at least for next week where iron condor weekly may be applied with view that 15900 remain resistance and 15500 may not break for now.

• Therefore Nifty calendar spreads hedged is not bad idea for coming week.

• Markets narrow range bound and at neckline support zone with uncertainty as to how long it could consolidate here and which side it would break down. Therefore trade with caution.

• India vix are at difficult low volatile levels for option traders both buyers and sellers and non directional trades are only to be thought. Will there be immediate mean reversion spike or will it remain at this for long is uncertain.

• Momentum  is sideways and Trend is bearish for short term on both indices and bias is negative.

• Positional long trades would hold good until a clear signal of  breaking  of major support zones indicated earlier, there is no point in exiting or shorting as of now.

USDINR options strategy: Weekly Expiry Jun 9 2021

 #usdinr bull put spread -sell 75.5 put and buy 74.75 put 50 lots.view moderate bullish. Reasoning is usdinr breaking out with momentum,trend,volume from 74.75 and net resistance seen near 74.5 and any correction also likely to hold 74 levels. good risk reward with reasonable pop.

Narrow Range Market :Weekly Market Analysis : July 5 2021

 

• False breakout weekly bearish candle on both Nifty & Bank Nifty.

• Nifty & Bank nifty shows a trending down move entire week on 1 hr charts and given up 20 day moving average support.

• Nifty weekly bearish candle open=high pattern.June month shows a spinning top small body.

• Nifty & Bank nifty seen taken support at previous swing lows.

• Latest nifty daily candle hammer-could be slightly bullish, 

• Bank nifty has a spinning top  candle pattern on daily and June month also has a bearish candle.

• Nifty & Bank nifty both has Bollinger band squeeze into narrow range and showing clear volatility contraction /consolidation.

• Nifty at major resistance confluence of previous resistances tested 5 times and near an all  time high 15915 and rounding number psychological level of 16000 close by.

• It immediate support at  15600 and then 15500 levels below acting good previous swing low supports and 15000 level are seen if that is broken.

• Bank nifty has 3 previous resistances to clear 37700/36500/35800/35300 and currently take  support near 34600-34800 levels and has 34000 as next support below

• Nifty RSI momentum has fallen off from bullish into into sideways zone and seen falling on  daily.However medium to long term momentum is intact in bullish area,

• Nifty daily both  bullish positive reverse divergences failed.

• Bank Nifty momentum daily continues to be in sideways zone and bent up  .Weekly momentum also seems to be slipping into sideways while monthly momentum  maintains to be in bullish zones.

• The bearish monthly momentum divergence seems to have worked out and pulled down bank nifty in June.

• Nifty ADX trend indicator continue in  bearish areas on daily timeframe with flat strength while weekly and monthly trend remain bullish with flat strength.

• Bank nifty has ADX trend indicator last week crossed over back to bearish  zones  on daily timeframe. The trend continue to be in bullish side on medium & long term timeframes with flat strength.

• Open interest data for Nifty and Bank nifty showing a short covering based on the futures contracts which is bullish.

• Highest options call writing for 08 July expiry is seen at 16000 with 15800 also seen having more writing while 15700  levels shows highest  support point for nifty with 15600/15500 support is close by.

• Bank-nifty options open interest data shows highest call writing at 35000 levels while highest put writing seen at 34500  levels that could act as support for the expiry

• Put call ratio for nifty accordingly is seen 0.8  which is not bullish while 0.79  for bank-nifty also is not bullish enough.

• India VIX  fall to historic lowest levels of 12.1 which is more than 10% fall further.

• The IV is above HIV 11.5 and  IVP remaining 0.4  levels which is at the new low volatility regime. 

• IT sector is bullish with strength in momentum and trend on short/medium/long term charts. All time high ending with doji

• FMCG is bullish with momentum bullish divergence seen and could regain momentum to move further up.

• Metal is sideways on short term and need wait till momentum pickup.

• Auto sector weekly momentum range shifted and could move up in short term and need wait or some more momentum catchup.

• Pharma has now turned bullish last will with breakout as discussed previous week

• Last week FII sold>  5000 cr in cash did almost no buying net June month.

• Thanks to DII who bought all of last 12 day continuously in cash and June month had buying > 7000 cr that helps market form not crashing.

• The net longs on derivatives of FII/DII had dipped.

• US markets are bullish 

• Dollar Index rising up 92 level.

•  USD-INR currency pair broke out of at resistance zone and hit 75 levels but daily gravestone Doji show bearish pressure as well.

• Gold showing a hammer weekly candle and last week seen to be moving up from the support zone and probably good time to invest in for medium term.

• India VIX has fallen to lowest 12 levels and it could mean revert and therefore vega positive option strategies like calendar spread would be applied to benefit on it. 

• Therefore Nifty calendar spreads hedged is not bad idea for coming week.

• Markets at a narrow range bound phase and there is uncertainty as to how long it could consolidate here and also which side it would break down.Therefore trade with caution.

• India vix are at difficult low volatile levels for option traders both buyers and sellers and non directional trades are only to be thought.

• Momentum  is sideways and Trend is bearish for short term on both indices and bias is negative.

• Positional long trades would hold good until a clear signal of  breaking  of major support zones indicated earlier, there is no point in exiting or shorting as of now.