Rajandran R Telecom Engineer turned Full-time Derivative Trader. Mostly Trading Nifty, Banknifty, USDINR and High Liquid Stock Derivatives. Trading the Markets Since 2006 onwards. Using Market Profile and Orderflow for more than a decade. Designed and published 100+ open source trading systems on various trading tools. Strongly believe that market understanding and robust trading frameworks are the key to the trading success. Writing about Markets, Trading System Design, Market Sentiment, Trading Softwares & Trading Nuances since 2007 onwards. Author of Marketcalls.in and Co-Creator of Algomojo (Algorithmic Trading Platform for DIY Traders)

More Short Covering Possibilities in Nifty Futures as the selling gets too Emotional and More Crowded

55 sec read

When more and more momentum selling is happening at some points it ends up with more emotional momentum traders. It is like how a phoenix rises from the ashes. Yes, the smart money buyers arrive and absorb those emotional momentum selling pressure when the market itself sees its worst crisis.

What is a Smart Buyer Commitment?

Volume commitment happens with smart money and very often comes at an extreme impulsive phase when huge panic is observed in the markets. Interestingly most of the smart money happens when the markets are bottoming out / intermediate bottoms.

Speaking about the Feb series is all about the momentum sellers entered at various levels. However, the news based event Ukraine – Russian war, NATO & worldwide sanctions, rising crude, inflation and other economic worries spooked the market and triggered the emotional momentum sellers to join the party when the music is about to stop and the price to go against their favour.

Smart Volume commitment happened as buyers absorbed the strong selling pressure on the 24th of February and 28th of February as well and those zones are likely odds of strong buyers stepping in when the crisis is at its peak.

Crowded Momentum Sellers in Nifty Futures

And currently, Nifty futures is crowded with more and more crowded momentum sellers usually this sort of crowded selling triggers an avalanche of short covering. i.e one trader’s short-covering triggers another trader’s short covering and the resultant activity could be seen as a mega short covering towards 17250, 17400 and ultimately towards 17700 levels.

Awaiting the march series to happen!

Rajandran R Telecom Engineer turned Full-time Derivative Trader. Mostly Trading Nifty, Banknifty, USDINR and High Liquid Stock Derivatives. Trading the Markets Since 2006 onwards. Using Market Profile and Orderflow for more than a decade. Designed and published 100+ open source trading systems on various trading tools. Strongly believe that market understanding and robust trading frameworks are the key to the trading success. Writing about Markets, Trading System Design, Market Sentiment, Trading Softwares & Trading Nuances since 2007 onwards. Author of Marketcalls.in and Co-Creator of Algomojo (Algorithmic Trading Platform for DIY Traders)

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