Pre-Market Analysis: Banknifty Future – 29th Sept 2020

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On Monday, Bank-nifty opened just above PDH (previous day’s high) and tested PDH (previous day’s high) and went above forming a NVD (Normal variation day) to upside. Entire day bulls were in control and there were no signs of bears trying to protect which was unexpected for me. Anyway, We are now at top of a 1400 points rally in banknifty in just two days and also the close is at the lower end of the sideways consolidation that happened over two weeks before we broke down, the price action today carries a greater significance. Though due to momentum, we might move above previous day’s high but we need to see if Buyers are able to sustain those levels and if they can, then sellers will be in trouble.

What can be expected now:

In both Nifty and Banknifty, Buyers seems to be in control for now and we are now at a crucial levels in both indicates after a big two days rally as buyers would now be challenging the higher timeframe sellers as we are back to the level from which this breakdown started. In case buyers are above to move higher again today with conviction, this rally might sustain for some more days and might also take out the top but if sellers are able to defend the prices and move prices back inside previous day’s range, this will not be good for buyers. So, PDH level (21750) is very important today and we need to watch price auction at that level carefully.

Trade plan for today:

I do not have any plan to trade open auction as I do not have much clarity. Even if prices move up today, I am okay to miss it. Only in case prices are accepted back inside previous day’s range, I will look for a short trade but then any sideways move at the top of the renage is not good for sellers, so we need to be careful about short trades also if they are not moving as expected. Later, I will decide my view based on IB range (Initial Balance) and IB placement.

Some cautions:

  1. After huge rally in both Nifty and Bank nifty for last two days, we are back to levels from where breakdown started, so these levels are crucial. So, it better to wait for some more price action to decide if bulls are in control or bears.


Please note that this is a personal view for learning , observational and education purpose and is not a trading recommendation. Trading futures carry a risk, so you should consult a financial expert before taking any risk. Also, Bank-nifty in above statements Indicate Bank-nifty future for current month and not Bank-nifty index.

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