29 Feb ’24 — Nifty reclaims the lost Support, back with a message!
Nifty Analysis — Stance Neutral ➡️
One of the good points about drawing the support and resistance lines is that we can guess with a higher accuracy when the markets will pause/reverse or cut through. See what happened today — flat opening, a small bump upside, and then a ferocious downward action. Looking at those 2 RED candles, I really thought the 21913 support would give away. The candles at 11.07 and 11.11 almost gave away the clue that support would not get rejected again.
The most surprising aspect of today’s price action was the action in the last 30 minutes. Nifty rallied right from the 21913 support to the 22051 resistance and then ran out of time. The recovery today almost confirms that the BEARS are going empty-handed.
On the higher timeframe, the last candle of the day stands out, ample GREENery for the Bulls to feast. We are not removing the double top (M pattern) for now, because to negate that Nifty50 has to take out the ATH. If the momentum stalls in either direction — the prevailing beast wins, so both the Bulls and Bears have to be careful. We wish to go with the neutral stance tomorrow and then take a call based on the opening 63 minutes of action.
BankNifty Analysis — Stance Bearish ⬇️
BankNifty ended the day in GREEN, up 157pts, but we are still bearish as the resistance line was not taken out (bearish trend line). Also, we are in the bearish channel, the longer we stay in it — the stronger the BEARS grows. 3 candles between 09.59 to 10.07 gave away 498pts ~ 1.08%. And we really thought, it could be the beginning of a longer bear attack. Well, our short call for today did not work out as planned — we were able to cover up some losses as the expiry trades gave outsized premiums due to a spike in IV. The last 30 minutes added 394pts ~ 0.86pts.
A part of the spike in volume could be attributed to the monthly rebalancing. That also means a portion of the price action could be manipulated as well. We will get to know in detail during the opening hours tomorrow. We wish to maintain the bearish stance as long as the sloping blue resistance is not taken out. To go bullish, BN has to rally all the way up above the double-top pattern.
Algo Trading
Due to the monthly expiry, I did not have spare funds to deploy for Algo trades, instead, I put them on the forward test mode. It showed a profit of 19858.
· Intraday Algos run via AlgoTest on Kotak
· Webhooks automation run via TradingView on Dhan