01 Aug ’23 Post Mortem on Nifty & BankNifty | FinNifty weekly expiry analysis
FinNifty Analysis
From the last expiry and today, Finnifty has fallen 197pts ~ 0.96%. We did hit an ATH of 20666 on 27th Jul and the same day we fell quite deeply. Today’s close is almost matching the intraday low set on that day.
Today’s Analysis
There was some interesting price action till 12.50 today — the fall was quite decent to watch esp after a gap up open. However the momentum was not in favor and we quickly gained back 82pts ~ 0.41% to finally close flattish. The usual volatility was missing today. Usually the trading in finnifty sucks out the liquidity from nifty and banknifty — but did not see that much activity today. Will wait for final traded contract numbers from exchange to verify this.
Nifty Analysis
I had a long bias on Nifty from yesterday, the gap up was expected but the fall from 10.10 to 10.45 looked quite surprising to me. NiftyIT was supporting, the earlier fall came mostly from the FinNifty components — its understandable as its expiry.
The much awaited levels to watch out for were 19700 to 19680 where nifty had spent some time yesterday as well as on 27th Jul. The below chart will show the relevance of 19700 levels a break would have ensured in a bias shift from long to neutral.
The 60pts ~ 0.31% rally that followed till 13.30 gave hopes to the bulls. But for any bullish activity we need some strong action tomorrow, the volume + price action in RELIANCE in the closing minutes did not favorable, so before fresh longs we will monitor the price action during the opening 1hr tomorrow. Till then its better that we stay neutral.
BankNifty Analysis
Banknfty fell 309pts ~ 0.68% from the day’s high to the day’s low. The gap up open was a surprise but the fall wasn’t. Unlike Nifty, banknify is out of bearish hold yet. However the inability to push down prices even after getting an initial momentum during the day may not go in favor of the bears.
The top formed today (encircled in blue) may be considered as the first lower high as we have respected the M like pattern (double top). I wish to change my bias from neutral to bearish for banknifty for tomorrow.
