As we discussed, Banknifty's bullishness in past sessions has hit its target today.
If we look at the chart now:
The market has touched the target (49471), as we mentioned in the previous analysis. A huge fall was registered once the given target got hit. That means it's working as a good resistance zone for the upcoming session. Now, for the market to go further, it has to take some consolidation in the range (49168-49650), which is Fib level (0.38).
If we look at the OI data:
PCR = 0.98, which has fallen from 1.34. That indicates that it had a huge PE winding today, which can also be seen in the OI chart. There is a CE addition for 49500 and 50000, which is going to provide good resistance from now on. 49000 is good support at lower levels.
I am expecting a sideways in the range (49168-49650) with a good volatility market in upcoming sessions because VIX is 23+.
Reason:
Verdict: Sideways or Bearish
Plan of action:
Sell 49600 CE and 49100 PE (Hedge it with 15/- premium)
Note: Exit CE if it breaks 49700 to the upside & Exit PE if it breaks 49100 to the downside. But right now, there are more chances for the market to be sideways or bearish.
If we look at the chart now:
The market has touched the target (49471), as we mentioned in the previous analysis. A huge fall was registered once the given target got hit. That means it's working as a good resistance zone for the upcoming session. Now, for the market to go further, it has to take some consolidation in the range (49168-49650), which is Fib level (0.38).
If we look at the OI data:
PCR = 0.98, which has fallen from 1.34. That indicates that it had a huge PE winding today, which can also be seen in the OI chart. There is a CE addition for 49500 and 50000, which is going to provide good resistance from now on. 49000 is good support at lower levels.
I am expecting a sideways in the range (49168-49650) with a good volatility market in upcoming sessions because VIX is 23+.
Reason:
- RSI ~ 60 falling from the upside shows a good reduction in the bull's strength.
- EMA(13) > Price > EMA(200), which indicates indecisive or rather sideways market..
- The market is still making HH & HL, which shows bullishness, but a huge selling pressure from the upside shows lots of sellers' interest that might lead to a sideways market.
- PCR = 0.98 indicates bullishness, but this has fallen from 1.34, which shows lots of profit booking on the upside.
- price < VWAP shows that a weak market structure can lead to a bearish or sideways market.
Verdict: Sideways or Bearish
Plan of action:
Sell 49600 CE and 49100 PE (Hedge it with 15/- premium)
Note: Exit CE if it breaks 49700 to the upside & Exit PE if it breaks 49100 to the downside. But right now, there are more chances for the market to be sideways or bearish.
