30 Jun ’23 Post Mortem on Nifty & BankNifty | Markets on steroids?
Firstly a big thankyou to the TradingView “MINDS” community for supporting & cheering my work.
I have published the post mortem of the Quarter April to Jun 2023 as a book on Amazon. You can buy the same by clicking here. (Some offer is running currently & the book is available for free for next 5 days).
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I am restructuring the daily report to include Nifty50 along with BankNifty, thereby help reaching a bigger trader fraternity. These reports should not be used as a recommendation to buy or sell, it has to be studied with an education intent to develop your knowledge & trading skills.
Nifty50 Daily
Nifty opened gap up at 19076 immediately hitting an all time high, that was just the start. Most of the traders were expecting N50 to close the gap and fall to the trading range of the previous day. That did not happen, instead N50 was firing on all cylinders.
The major reason for this thrust in rally came from NiftyIT which ended +2.5% today. IT’s strength overshadowed almost every other sector — the result a perfect rally for N50 today with strong closing.
The new ATH is now 19201.7. Just imagine we had a 200pts swing once the magic number of 19000 was broken in the last session. Most likely few of the participants who missed out would have come back with loads of cash to deploy. Is it a good time to have a FOMO feeling — I am not quite sure!
Since there are no available resistance levels — its a free hand for N50 to play boss. The only way to restrict N50 would be for the big boys to start writing CE shorts. The problem is — who will have the courage to short sell?
Since its a breakout rally & the momentum could get so strong to wipe you off the feet. Chances are the bears will have to wait for some external triggers as the earnings may not disappoint.
1hr TF
The last 3 sessions have been highlighted, if you notice we had island gaps in all 3 indicating a sentiment shift.
The first support level has been marked at 18880 now below which N50 could get back into the range-based trading.
BankNifty Daily
Comparing with N50, banknifty did close the gap-up opening. Looking at the opening minutes I felt BN had more inclination to fall into the trading range of the previous day, but the way in which NiftyIT was surging — BN would have changed the mind to play along.
BN also hit a new all time high of 44787.1 today, but the thrust to go up was not as convincing as N50. HDFC-HDFCBK may be the primary reason that these indices has got a new-found passion to outperform. Well we had 2 news flow in IndusInd and Federal Bank which helped it jump more than 3%.
The one aspect in today’s price action was the helplessness of the bears, they tried to bring down BN on 2 occasions but did not get enough crowd support.
The good news that came in was “Indian banks’ gross bad loans fall to a 10-year low of 3.9%: RBI’s Financial Stability Report”.
One news which looked scary was “Bank of America nurses $100bn paper loss after big bet in bond market”. I am not sure if the SPX & SPF has priced this in.
Something is not adding up, either the US FED rates are too high or the Indian RBI rates are not high enough. We have dichotomy in the financial sector — India vs US.
1hr TF
BN has 2 islands vs 3 for N50. The new support level is now 44443 below which we can expect some range-bound trade. As it stands situation is very favorable for the bulls to continue the dream run.
