22 Mar ’24 — Nifty makes a Run, but crucial profit booking in last hour — Nifty & BankNifty…
Nifty Analysis — Stance Neutral ➡️
Recap from yesterday: “Momentum is still something Nifty50 was not able to find so far, mainly because follow-up buying or selling was just not there.”
Nifty has become really unpredictable and is taking all the professional traders on a wild ride. We opened Gap-down, and the 3rd candle went through the support of 21913. Just when we thought we might have a down day, Nifty makes a reversal. Magically the support of 21913 is held and Nifty moves up an impressive 297 points ~ 1.36%. On its way, it spent some time @ 22051 resistance too, but the breakthrough was proof that the animal was a Bull and not a Bear. In the closing 40 minutes, we had a round of profit booking that ensured we fell around 117 points.
Nifty creates an inverse head and shoulders on the 63mts chart. IH&S is a bullish pattern. But we are not changing our stance that fast. We will wait for follow-through buying on Tuesday and then go long. The support of 22051 will be crucial and N50 has to defend it if we wish to go bullish. Meanwhile, it is a long weekend for us and that could also mean that global macros could change in between as well.
BankNifty Analysis — Stance Neutral ➡️
BankNifty stays in the neutral zone for yet another day. Even when N50 made its 1.36%, BN went up only by 0.9%. NiftyIT was tanking on one side, but BN was holding its ground from falling. I am seriously confused about whether Nifty or BankNifty has the lower beta. Even the profit booking in the last 40mts did not have a wild impact on BN but it might have taken the profits out of N50 straddlers.
We are almost midway between the nearest support & resistance. The slope of the 200 EMA will prove the point that we are neutral, just check its slope — it’s almost parallel to the X-axis. This was the major reason why I never went bearish even though we fell 2000+ points from the ATH. We continue to maintain our neutral stance for Tuesday and would like to build fresh positions based on the price action.
Algo Trading
Our algo trades ended today with a loss of 7029 rupees, thanks to the swing from Nifty50. So for my current month, the Nifty Algos are in loss whereas BN is in good profits. This takes me back to the earlier question, which one has the lower beta?
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