Pre-Market Analysis: Nifty Future – 5th Jan 2022

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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, Nifty opened just above previous day’s high (OTD up) and initiative buyers tried to push prices to upside but there was a strong responsive selling in the start which pushed prices back inside range. but this selling could not continue further down and buyers supported the prices pushing the prices back above PDH. There was a lot of consolidation above PDH and towards end, buyers moved the prices further up to close at the top forming NVD day up.   Value area also moved up so we can say that Higher timeframe buyers are in control for now but trade facilitation by buyers was not very good which could sense a pause in this straight upmove.

What can be expected now:

We need to observe where prices are getting accepted – above or below POC. In case of acceptance above POC, prices can move further upside and in case of acceptance below POC, there can be be sideways to down move but I am not very bearish on Market until we have a clear indication.

PDH (17872), POC (17765) and PDL (17632) are the levels to look out for from previous day’s range. Above PDH, we can test weak high at 18000 where price action will be critical and break of that can take prices further up. In case of acceptance below PDL, we can expect price to test weak low at 17410.

Trade plan for today:

Nifty is expected to open inside previous day’s range and there is not much clarity at open. I would wait for IB range completion and then depending on where IB range is formed – Above or below POC, we will plan a trade in that direction. Inn case of no clear direction, we can ignore trades or trail tight.

Some cautions:

  1. No Short trades above POC.
  2. No Long trade below POC.


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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