03 Jan ’24 — Nifty gets a stance change, Bears are back! — Nifty & BankNifty PostMortem Analysis
Nifty Analysis — Stance Bearish⬇️
We got our first target of 21530 hit today and as soon as the channel top line got breached — the stance changed to bearish. Technically Nifty is far ahead of BankNifty as N50 has only broken into the channel whereas BN has broken out. The status change is just because of momentum that is favoring the Bears. Come 2024 and they are back!
NiftyIT deserves a special mention, it fell a whopping 2.59% today. There is severe competition going on between NiftyIT and BankNifty on who wants to become the “leader” in trend reversals.
On the higher time frame, you can see how N50 is just entering the channel. If the conditions stay like this for tomorrow — we can see a good trending move tomorrow. The first threat to keep in mind is the rejection that came on 21st Dec when N50 bounced from the channel topline. Global macros are much worse today and we are hoping tomorrow’s expiry should belong to the bears. Our first target will be 21409 and then 21310.
BankNifty Weekly Expiry Analysis
BN just fell 742pts ~ 1.53% between the last expiry and today, logically it got only 4 working days as the last expiry was on a Thursday. A 742pts move is nothing considering the shape BN is currently in. Since the stance is now bearish, we are hoping for a build-up in the momentum soon.
BankNifty Today Analysis — Stance Bearish⬇️
So both BN and N50 have the same stance of “bearish” now. Usually, when the directional bias is the same for both these indices, we expect the markets to cover some ground quickly.
Except for the opening candle, BN had a pretty boring day otherwise. BN was keeping the losses under control on Nifty. And the banks ICICIBANK, AXISBANK & KOTAKBANK were trending in the opposite direction of HDFCBANK. Yesterday it was the real opposite — HDFC was staying cool while the others were dropping.
The expiry was meaningful today with frequent surges of volatility swinging the strike premiums. Even though BN managed to tread above water for some time, there were no visible signs of a bullish recovery.
We are quite safely away from the channel now. To renter it, BN will have to rise to 48600+ tomorrow. If it doesn’t, then it’s in the bear’s control. We continue to look for shorting opportunities with the first target as 47006.