Pre-Market Analysis: Nifty Future – 16th Oct 2020

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Observation from previous day:

On Thursday, Nifty opened inside previous day’s range and sellers aggressively took it down at the open itself. Nifty continued moving down entire day forming a big trend down d ay of almost 300 points and closing well below previous day’s low. On daily charts also, it has formed bearish engulfing pattern which is not a good indication for buyers in days to come. Usually after this big move, Nifty should consolidate before again moving in the downward directions, so I have a sideways to bearish view in nifty for today. We can see more downside only if prices breaks and stays below PDL (previous day’s low). Also VWAP levels of 11825 is an important level to watch for on upside.

What can be expected now:

I have a sideways view in Nifty is prices fail to be accepted above PDL (previous day’s low). Only in case, nifty breaks PDL decisively, it can move further down. I will not be looking for any long trades today and Bulls need some time to gain their lost ground in case they want to comeback.

Trade plan for today:

I am expecting Nifty to open near PDL (previous day’s low) and there can be sideways movement throughout the day at lower levels. So, I would stay out of any trades in Nifty. Only acceptance below PDL (previous day’s low) can bring more downside in nifty.

Some cautions:

  1. Nifty had a big fall on Thursday, so there is not point looking for any long trades today.
  2. Break of PDL can bring more downside and Banknifty should support Nifty on the downside for any substantial move. So , keep an eye on Banknifty also.


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, Nifty in above statements Indicate Nifty future for current month and not Nifty index.

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