07 Aug ’23 Post Mortem on BankNifty - bearish to neutral now
Banknifty had a perfect flat range bound day today. Normally we dont see it that often, but banknifty seems like a tamed beast as of now. You might be bored to hear this from me again that from “January 2023, I think banknifty is less volatile than Nifty50”. A look at the options data is ample proof - the OTM option values today is more like we usually see on a wednesday.
All non-directional traders who deployed straddle, strangles or iron condor/fly would have made some easy money as there was no breakout or breakdown.
Just like the stance changed on Nifty from neutral to bullish, I preferred to change the stance on banknifty to neutral from bearish. Here again it is much early as we had no decisive break of the recent H&S nor the trendline. But today’s price action has influenced my decision - the bulls and bears are currently equally powered and it looks like both of them do not want to pick a fight now.
All non-directional traders who deployed straddle, strangles or iron condor/fly would have made some easy money as there was no breakout or breakdown.
Just like the stance changed on Nifty from neutral to bullish, I preferred to change the stance on banknifty to neutral from bearish. Here again it is much early as we had no decisive break of the recent H&S nor the trendline. But today’s price action has influenced my decision - the bulls and bears are currently equally powered and it looks like both of them do not want to pick a fight now.
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