20th Nov ’23 — A Gradual Slipping Market — PostMortem on Nifty & BankNifty
Nifty Analysis
Recap from yesterday: ”At present, I wish to change my stance to neutral and wait for further clues. If we start dropping on Monday, I would prefer to go bearish with the first target of 19562 and then 19446.”
Nifty did not have that much of a flavor today. We opened inline and then started drifting downwards. Although we had one attempt to go up i.e. between 10.05 to 10.30 — it was not sufficient to retest the 19776 resistance level. Notice the descending channel drawn, the slope is not high either, but if we connect the dots — it seems like we were following the previous day’s price action.
Even though we fell 37pts today, the chart is not bearish yet. Not until the support of 19562 breaks. So I would like to continue with my neutral stance till then. For bullish momentum to resume, Nifty will have to take out 19776 and 19875 in one go, but for a bearish signal a single support break would suffice.
BankNifty Analysis
BankNifty started the day on a flat note and was not falling, which came as a surprise because towards the end of Friday’s session the short build-up was pretty intense. The low of the day was hit in the opening 5mts only and did not even go to the support level of 43404. We even had a recovery of 278pts ~ 0.64% by 10.30.
During this recovery, the options premium on the CE side fell which gave a clue that we may not be having further strong selling today. However, towards the end of the day, we had a similar build-up of short positions as of Friday. This option flow is still suggesting me to go bearish on BankNifty.
On the 1hr TF, BankNifty showed no interest in getting back into the ascending channel. I suppose that channel can be removed as it will not make any sense going forward. Seems like its just a support and resistance game for some time now. My first support comes at 43566 and 2nd one at 43404 (unchanged as we did not break any SR today). The main resistance is still at 44063 which looks quite far away. I wish to maintain my bearish stance till 44063 resistance is not taken out.