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 Tuesday, Nifty opened inside previous day range near POC and buyers immediately pushed the prices above PDH. Though there was some selling above PDH near 17000 levels but it was not good enough to take prices back inside range and there after Prices continued further up almost one -time framing again except I period where bears again tried to push prices down and again failed. This was the second back to back day of good one time framing movement in Nifty and this is what we expected in previous day’s analysis also, which is upside movement if prices accepted above PDH and Nifty moved a lot more than my expectations. Anyway, again today, there is no point in shorting this type of Market, so we can still move upside again if prices keep accepting above PDH.
What can be expected now:
Exactly same like yesterday’s analysis – After a clear follow through to upside, we can expect some momentum to be still there and hence we can expect prices to move further up today if they accept above PDH. In case prices trade back inside previous day’s range, there can be a sideways move but until prices trade above 16700, we can look for only long trades,
PDH (17143) , POC (16995) and PDL (16890) are important levels from previous day’s range. PDH is also all time high and above PDH is no trade zone and acceptance above PDH can take prices higher. Below PDH, price action at POC is crucial and below POC, we can drift down to PDL. Below PDL, we can close the gap at 16730 but this is less likely to happen at least for today.
Trade plan for today:
I am not trading Intraday today as support to Trader’s fraternity protesting Margin rules. But Nifty is expected to open inside previous day’s range but near PDH and we need to observe if prices are accepting above PDH or below PDH today, Above PDH is bullish and below PDH is sideways. There is no point being a bear today also.
- No long trades if prices trade below PDH.
- No Short trades if prices trade above 16700 levels.
- Banknifty moved sideways whereas Nifty moved a good distance upside yesterday. We can expect banknifty to catchup if Nifty moves further higher, so important to observe banknifty.
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.