10 Jan ’24–163pts pullback from a wedge — Nifty & BankNifty PostMortem Analysis
Nifty Analysis — Stance Neutral ➡️
Even without breaking the upper trend line, we had to change the stance from bearish to neutral today. The ball was in bear’s court today and they did not score. A small falling wedge pattern created a short squeeze that took N50 161pts ~ 0.75% higher. Credits to RELIANCE that contributed to ~ 40pts today. Momentum is everything in a trend, we will wait and watch how Nifty50 reacts to the expiry day tomorrow.
The last candle which is strongly GREEN is standing out. It looks like the 21491 support is respected for now. If we fall below that tomorrow, we will not hesitate to switch back the stance to bearish. What the dominant animal is tomorrow — bear or bull is totally dependent on the opening 15mts.
BankNifty Weekly Expiry Analysis
Between the last expiry and today, BN fell 383pts and most importantly breached a support level (47539). Even though the start of the week was good, the bulls gave away the control to the bears by Friday.
BankNifty Today Analysis — Stance Bearish ⬇️
Unlike Nifty50, BankNifty did not have a strong pullback today. There was no wedge-like formation, but the negativity was missing totally. The open was gap-down from which BN recovered decently and remained range bound. BN was trading in the green for most of the time today.
BN is not out of the bearish hold yet. The first thing that has to be taken care of is the 47539 resistance and the best way to take that out is via a gap up. It has become quite predictable these days, the way to go past a level is via a gap-up or gap-down. Neither the bulls nor the bears have the nerve to battle it out during the trading day.
Our stance remains bearish even for tomorrow. Will switch to neutral if we have a 63mts candle above the resistance level marked in blue. Even though we have the Nifty50 expiry tomorrow, the options premiums are looking pretty dead. Hoping BN strikes will have some juice for tomorrow.