Pre-Market Analysis: Banknifty Future – 17th Nov 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 Tuesday, prices opened near PDL and tested POC before sellers pushed in down below PDL. For the rest of the day prices continued to move down but there was lack of momentum and poor trade facilitation by sellers until last few hours where there was good selling priobably from higher timeframe. The prices down to close at bottom forming NVD down day and the value area has shifted down. Also on daily charts, banknifty is at crucial support levels and we need to see if it breaks down today or not.

What can be expected now:

We need to see if the sellers that entered in last hours are able to give follow through to downside today or not. We have seen in yesterday’s prices movement that there is less directional conviction by sellers so we have to be cautious. So only in case prices accept below PDL, I will be bearish on market and that too with caution.

PDH (38845), POC (38530) and PDL (38290) are the levels to watch out for in banknifty. Above PDH , prices can test weak high at 39350 and below PDL prices can test weak low at 37800 levels.

Trade plan for today:

Prices are expected to open below previous day’s range  and I will wait for test of PDL at open and will opt for a short trade only in case of OTD down. In all other scenarios , I will wait for IB range and then decide on my trades. I am bearish only below PDL and bullish if prices fail to trade below PDL but I will prefer more clarity opting for long trades if prices fail to break PDL .

Some cautions:

  1. No long trades below PDL.
  2. No short trades above PDL.
  3. Banknifty is weaker than nifty, so we need to keep watching Banknifty to get clues on nifty.

Disclaimer:

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

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