Pre-Market Analysis: Nifty Future – 5th Apr 2021

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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, HVN (High volume node)

Observation from previous day:

On Thursdayy, Nifty opened inside previous day’s range near PDH and buyers tried to take prices above PDH in the start but failed. There was a ORR (open rejection reverse) at open and sellers took the control marking prices down below IB low. The interesting thing was that sellers also failed to move prices even to test PDL and once prices were back inside IB range, we can conclude that sellers responsible to responsive selling from PDH were short timeframe sellers. The responsive buyers then took control and moved prices above PDH testing the poor high above PDH and closing near the top forming a neutral extreme day. Now Neural extreme day at swing high or swing lows has a significance but the price action on Thruday was neither at any swing high or swing low, so nothing is clear right now.

What can be expected now:

For buyers to be in control, prices have to move above PDH otherwise it may remain sideways or move with a downward bias again. Also, we have seen the selling is from shorter timeframe, so selling at these levels also cannot be trusted until the prices go down and gets accepted below PDL. SO, as long as we remain inside previous day’s range, there is no clarity and we can expect sideways move but if we go and test any extreme, then price action (or acceptance /rejection) beyond that levels becomes very important.

PDH , POCand PDL are the levels to look out for from previous day’s range. Above PDH, we can test poor high and below PDL, we can fill the gap at 14673.

Trade plan for today:

Nifty is expected to open inside previous day’s range and I have no clarity at open auction , so I will wait and watch. Probably, I will wait for IB range formation and then decide on the direction of the trades but as I said, we can expect sideways move in case of acceptance inside range and in that case , any directional trades will be at higher risk.

Some cautions:

  1. No short trades are risky if prices trade above PDH.
  2. No long trade if prices trade below PDL.
  3. Watch out for strength or weakness in Bankninfty


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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