BANKNIFTY : Trading plan and levels for 16-Dec-2024

לפני 7 ימים

Intro: Review of Previous Day’s Plan
Yesterday’s chart depicted key levels for supply, resistance, and demand zones. The anticipated plan highlighted a sideways consolidation around the "Last Resistance for ATM" zone, followed by a bullish breakout near 53,700. As per the actual market movement, Bank Nifty tested the resistance at 53,700 but failed to sustain momentum, leading to a pullback towards the Opening Support Zone. This reaffirms the importance of respecting identified zones and acting on confirmation signals.

Color Coding in the Chart:

Yellow: Sideways trend

Green: Bullish trend

Red: Bearish trend

Trading Plan for 16th December 2024

1. If Gap Up Opening (200+ points above previous close)
   
   A gap-up scenario would place Bank Nifty near the upper resistance zone (54,092 to 54,322). In such cases:
   
   Action Plan: Wait for the first 15-30 minutes to observe price stability. If an hourly candle closes above 54,322, initiate a long position with a target of 54,787 (supply zone).
   
   If prices show rejection from 54,322, expect a retracement towards the Opening Support Zone (53,700 to 53,540).
   
   Avoid chasing the gap-up blindly; confirm the breakout or reversal with volume and price action.
   
   
2. If Flat Opening
   
   A flat opening would likely position Bank Nifty around the Opening Support/Resistance Zone (53,700 to 53,540).
   
   Action Plan: Monitor price action within this zone. A strong breakout above 53,700 can lead to bullish momentum, targeting 54,092 first and then 54,322.
   
   On the flip side, if Bank Nifty breaks below 53,540, a bearish trend may develop, pulling prices toward the Opening Support at 53,398 and potentially the Last Support for Intraday at 53,074.
   
   Be cautious and use tight stop losses, especially if volatility is high.
   
   
3. If Gap Down Opening (200+ points below previous close)
   
   A gap-down opening may test the Last Support for Intraday (53,074).
   
   Action Plan: If Bank Nifty holds above 53,074, consider entering a long position with a target of 53,540 and 53,700. Look for bullish reversal candles at this level.
   
   If prices break below 53,074, a bearish trend could extend toward 52,700 and further to the Mitigated Demand Zone (52,484 to 52,311). Avoid entering counter-trend trades unless clear reversal signs are observed.
   
   Risk-averse traders should wait for price action confirmation to avoid false breakouts.
   
   Tips for Risk Management in Options Trading:
   
   Use defined stop losses to protect your capital, particularly on hourly candle closures beyond invalidation zones.
   
   Avoid over-leveraging and position your trades based on your risk tolerance. As a guideline, limit exposure to 2-3% of your total capital per trade.
   
   Focus on ATM or slightly ITM strike prices with adequate liquidity for intraday trades. Avoid OTM options during volatile conditions.
   
   Implement a time-based exit if the trade does not hit the target within a predefined period.
   
   Summary and Conclusion:
   Bank Nifty’s price movement today will likely hinge on the interaction with key zones like 53,700 (Opening Resistance) and 53,074 (Last Intraday Support). Use the first 30 minutes post-opening to observe stability, and act based on breakouts or reversals. Follow a disciplined approach and avoid emotional trading.
   
   Disclaimer: I am not a SEBI-registered analyst. The above plan is for educational purposes only. Please consult with your financial advisor before making any trading decisions.