In the last week we had seen aggressive short covering from shorter timeframe sellers followed by lack of momentum post the breakout of 8800 zone. In the last three days again we started making fresh three day consolidation in the range 8800-8860 zone indicating that trend is getting tired and whomever trading this zone is most likely dominated by shorter timeframe buyers and this behavior also resembles that upside is very limited and one should prepared to trade with reversal mindset. Momentum Indicator is marginally up but subdued. This is the phase where the crowd cheers for every small up trends.
Daily Sentiment
Daily Sentiment indicator is holding positive. However Weekly sentimental indicator is negative for the last three weeks. This indicates that price reversal below 8800 or the price consolidating below 8860 could drag the price even lower.
Weekly Sentiment
India VIX
India VIX is currently in the declining phase since mid of june 2016 and currently at 12.9 very close to the all time low indicating that fear is completely eliminated from the markets.
Open Interest
Open interest is now currently maintaining the expiry range 8600-9000. Put writers are currently aggressive at 8500PE and 8600PE, Call writers are aggressive at 9000CE. And the Participation Open Interest indicates that FII’s and Clients piled up their inventories in futures to the extreme.
Related Readings and Observations
Nifty Trading sentiment turned negative – Apr 2020 Series Short term Outlook Nifty Futures - Daily Charts Nifty trading sentiment turned negative at the close that breaking the streak of trending longs. And short term sentiment is pointed towards the […]- Price Discovery Process and How to Trade the Open using Market Profile We know that the purpose of the exchange is to facilitate trading between buyers and sellers. Auction market theory is a basic stepping point to understand how the auction happens among […]
- Island Gap Reversal in Nifty Spot – When There is Blood on the Streets Currently Blood, Fear, Anger is there on the streets especially for the Put writers, Investors, Long Only traders. But let me tell you something, "markets are filled with emotions, fear & greed".
- Nifty Futures – Extreme Negative Sentiment Nifty Futures last Friday has broken the 5-day balance and managed to trade below the 5-day balance. Though breakout failure is seen during the middle of the day value formed lower overall.
- Nifty Futures at Critical Support Zone Last week nifty futures completely entered in a sideways mode. The entire 5 trading sessions ended up in range-bound price action between 12318 - 12412 levels. Too many short term buyers […]
- Nifty Futures at All-Time High What Next? Short term sentiment continues to be on the positive side for the last 5 trading sessions and price is one timeframe on the daily timeframe. Immediate supports got built around 12345 levels
