Pre-Market Analysis: Banknifty Future – 24th Dec 2020

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Abbreviations I use in the post: PDH: Previous day’s high, PDL: Previous day’s low, IB: Initial Balance or First 1 hour range, NVD: Normal variation day (one of the market profile day types), OTD: open test drive, POC: Point of control

Observation from previous day:

On Wednesday, Banknifty opened inside previous day’s range and Buyers pushed the prices above PDH and prices moved above PDH to test and close just below the VWAP level of Monday. This PDH levels becomes important now as we need to see if prices are accepted above or below this level. Acceptance above this levels will open up possibility of Banknifty testing POC area 30340-30400. and acceptance below this level can give a sideways move in banknifty.

What can be expected now:

I am expecting Banknifty also to open up above PDH and in case of a gap, we a can stay out of open auction trades. Also, Today is expiry , so need to be cautious about the possibility of sideways move. Above, PDH, we need to see price action at 30340 levels and inside range POC levels of 29820 becomes important. Acceptance below 29820 is not good for buyers and prices can move down if accepted below these levels.

Trade plan for today:

I am bullish on banknifty if there is acceptance above PDH but in case of an gap up open, I will stay out of trade. Like nifty I will look for a long trade only at rejection from PDH levels, otherwise I will prefer to stay out. Today is expiry, so there can be a sideways movement.

Some cautions:

  1. Sellers are expected to defend 30340 levels , so this becomes important to observe if sellers are entering there or not.
  2. Banknifty is weaker than Nifty, So, we need to see if Nifty moves upwards, banknifty supports it or not.
  3. Today is expiry and tomorrow is holiday, so a sideways sluggish move can be expected.


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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