Nifty & BankNifty Analysis — 06 May 2024 — Indian markets have decoupled from Global peers —…
Nifty Analysis — Stance Neutral ➡️
Recap from yesterday: “The stance has been revised to neutral as the support is broken. For Monday we wish to go neutral if 22295 is broken and go long if 22519. Nifty Algos ended the day with a loss of -2374 INR.”
How do we explain the relevance of support and resistance more clearly than today? Just see the 3 encircled regions on the 4mts chart. The first one came in the opening minutes where the gap-up gave the impression that we were breaking out but the 09.35 and 09.39 candles did the humbling.
Between 10.39 to 11.11, N50 recovered a bit and tried to get past the 22519 resistance, only to fail. And the 3rd attempt came between 11.59 to 12.19 — which would have given some confidence to the Bears.
On the higher time frame, we are still in neutral territory and might require a bit more aggression by the Bears to bring down the prices. Our markets not rallying as against the recovery in US markets — speculating something to do with the re-election and taxation. Since I do not have any data points, will wait for more clarity.
Decided to add the screenshots of AlgoTest forward testing instead of live to stay away from regulatory troubles. Nifty Algo generated Rs2857 today.
BankNifty Analysis — Stance Neutral ➡️
48947 is a support/resistance level after this recent run, I have still not drawn the line as the price action was in uncharted waters for some time. If we hang on to these levels, I will get the SR added by tomorrow.
BN was quite strange today, Kotak after a good show of quarterly results went up 5%. That was quite expected, but how HDFC, ICICI, and AXIS traded throughout the day was totally surprising. The majority of them gave the impression that we were going up, and then quickly changed direction. At 14.31, HDFC quickly turned the direction again, and went up like 0.56% only to give it back later. I am yet to check the RBI circular on project financing changes on REC and PFC and the spillover effects on other assets.
For tomorrow, I wish to maintain the neutral stance. If we stay below 48661 for an extended period, I would even prefer to go short.
Algos ended up generating Rs15466 today.
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