Last week trading session ,Bank Nifty futures attracted lot many short term sellers came to compete in the market. Trading behavior was in such a way that most of the traders we dealt with them are mechanical/emotional/price based short term sellers. Especially the emotional sellers shown post the RBI policy announcement are possibly the price based sellers initiated trades based on price breaking down below the previous week low or price testing 50 day moving average on the daily timeframe.
Bank Nifty Futures consecutively making lower lows for the last 5 trading session on the daily charts. Price breaks the previous week low and in the last 1 hour of the trading session manage to close above friday low (Previous Week Low as well). Trading Sentiment continues to be negative as long as price holds below 25242 levels. Mondays price attempt closed the 1st Nov Gap.
Yet another 3 day balancing and slowly moving unproductive days for a positional trader in Nifty futures as it trades in 10360-10420 range for the last 3 trading sessions. Interestingly stops again got built around 10420 post todays panic intraday drop towards 10360 levels.
Last three days of markets would have drained the productivity of any positional trader in Nifty Futures as the markets rolls in a tight compressed fashion in a narrow 80 point range. Price finds resistance around 10390-10400 levels where most of the short term players are prone to keep their stop levels. Thursdays trading session shows a mid-day emotional sell-off followed by sharp recovery and closed flat for the trading session.
Nifty FMCG index formed a classical bearish island reversal pattern during the month of July 2017 since then it is drastically under-performing nifty and moving in a sideways phase, tightly compressed for the last 5 trading months.
Nifty PE ratio hovering above 26 levels for the the past 1-month. Monthly trading sentiment is continuing positive and at the extreme. Yearly profile shows a trending market with poor structure, which indicates short term is still bullish however the participation is getting more and more emotional in buying. Lack of symmetrical structure often suggests how emotional/patriotic long term players are!
Last two days Nifty futures made a down swing of approximately 200 points (from 10530 to 10330 levels). Interestingly on the weekly charts nifty had made a outside bar with a low confidence breakout. It looked below the previous week low 10350 and failed to accept below previous week low on EOD basis.
Nifty found short term resistance around 10500 zone and currently in the phase of short term correction. Trading sentiment and profile sentiment both turned to negative mode which brings more downside pressure for nifty in the very near term. On the downside 10350 and 10248 are the two major focus levels to watch in the very short term.
Nifty done one more All time high in the start of the November series. Should have raised the eyebrows of every equity derivative trader. From the Daily trading sentiment perspective Nifty is holding the positive sentiment for the last 6 trading sessions. Trading Excitement is at the extreme for this series.
Nifty is trading around All time high. October Futures is more of one-sided movement with an approximate swing of 500+ points swing. The trading sentiment is holding positive across the timeframes (Daily, Weekly, Monthly). No weakness yet from the market internals perspective. Trading Positional Shorts could be still not a profitable one unless you understand the inventory conditions of the market participants.
Nifty Future is trading very close to the all time high with mixed trading sentiments from market profile and indicator which could eventually lead into a sideways to uptrend phenomenon. Market internals are increasingly holding positive and put writers are aggressively killing the option premium at 9800PE, 9900PE, 10000PE, 10100PE. Diwali’s emotional trading is overcome by the Monday’s price action.
Bank Nifty Futures is under performing Nifty futures since the start of the Oct 2017 Series. Bank Nifty made a month-to-date gain of 1.3% vs Nifty Futures month-to-date gain of 4.6%. Bank Nifty indicator Sentiment and profile sentiment turned negative recently.