Daily Nifty Update 19th Sept. Two Lonely Candles at the top

Big Picture Sept 19th

The market opened near the top at 10175.6 indicating the Bull's sentiment to carry on from where they left yesterday.  The high of the day was again an all time high by a few more points. The bears had other plans though, and the Nifty touched a low of 10130 finally closing 10147 losing 5.55 points in the days trading.

All broad based indices except Nifty closed in green and sector indices indicated a mixed picture. About 5 of the indices closed in red with Metals and PSU Banks vying with each other for the top loser spot. Realty meanwhile was the top gainer.

The advances and declines were 1:1 indicating a neutral day while 114 scrips reached 52 week high and 11 securities reached 52 week low.

Technical Story

One look at the today's candle, it looks like a mirror image of yesterday's candle.
  • An island of two candles at the top, the candle today an inverse of yesterday's candle.
  • Yesterday was a celebratory candle, Bullish (Green candle), long upper wick, real body at the bottom and a small lower wick. Today's candle is the opposite - Bearish (Red candle), short upper wick, real body at the top and long lower wick. 
  • Volume was greater than yesterday.
  • The follow up day after a good break out was sorely missing today. 
  • The range for both days was almost even.
  • Since the candle made a all time high, the bearish candle with rejection of higher levels indicate an intense battle for reversing the trend. 
  • With the Index reaching new highs, the trend line has to be redrawn. With this realignment, the Nifty is back above the trend line and the support is at 10K levels.
  • This is reflected in the option strike price as well as the shorter moving average of SMA 5 and 10.
The Index is above all key moving averages on daily charts.


India Vix and Options Data

The India Vix ended higher by 0.2% indicating a bearish day in the options market. The Vix is showing signs of bottoming out. The day's options trading in Nifty indicated a more balanced picture with 7K puts and 6K calls being traded. The PCR ratio is 1.5 not much of a change from yesterday's overheated levels. 

The strike price band of 10000 and 10200 forms the support and resistance based on the max OI outstanding. Short build up in call strikes above 10150 and short build up in put strikes of 10050 and 10100 indicates bullish activities at these strike prices. Long unwinding at 10000 strike price on both the call and put side indicate support moving slowly to the higher levels. 

Outlook for 20 Sept

20 Sept Nifty Range 10111 to 10192 with support at 10092 and resistance at 10213
20 Sept BankNifty Range 24875 to 25218 with support at 24785.


 Stay Connected :


If you wish to participate in a discussion on this blog, please join the Facebook Group 

If you wish to learn more about my training programs you can find the details in this link.

If you wish to learn more about my thoughts on financial freedom, check this blog out.

Remember, after all, Financial Freedom is a mindset first !!!

Thank you for reading the Blog and Stay Tuned in.

Disclaimer :

This blog is for educational and awareness purpose only. The views are intended for discussion and exchange of views rather than an expert opinion. This is not an recommendation to buy or sell or invest in the stock market and derivatives market. Kindly exercise caution and perform your own due diligence before investing in the market, after fully and clearly understanding the risks involved.

Comments

Post a Comment

Popular posts from this blog

Investing Lessons from MOSL 23rd wealth creation study

Image
MY LEARNINGS FROM MOSL 23rd Wealth Creation Study Based on the Video (See link at the end)       LESSON 1 Buy only when the RoE is greater than the cost of capital. MOSL Assumes cost of capital to be 13%   My notes : The cost of capital for most companies can be assumed to be 12 to 15% based on their credit rating. The cost of capital for NBFCs could be 8 to 10% The cost of capital for Banks could be 6 to 8% Check the latest investor presentation or annual report to get this data. But a 13% filter on ROE will help to weed out most of the companies and provide you with a list of companies that is worth spending more time on. Some sectors like Infra have a RoE of less than 10%. So the big question is whether it is even worth looking at these for investment portfolio.    Lesson 2 Assuming the RoE test is passed and we have companies which we feel has a reasonable growth prospects (i.e. RoE > 13% or cost of capital) then it has the potentia
Read more

Daily and Weekly Nifty Chart Week ended 1st Sept.

Today, I have tried a vlog rather than the plain old simple blog. I have covered only the price action and the RSI in the video. Market breadth on Friday remained positive and Broad based indices and Sectoral Indices were also positive except for  Nifty IT which fell by 0.45%. It is too early in the expiry to check the Derivatives data. This week is likely to overshadowed by the geo political tensions as North Korea, Japan and USA are at loggerheads. Stay Connected : If you wish to participate in a discussion on this blog, please join the Facebook Group If you wish to learn more about my approach to stock investments , check this blog out . Remember, after all, Financial Freedom is a mindset first !!! Thank you for reading the Blog and Stay Tuned in. Disclaimer : This blog is for educational and awareness purpose only. The views are intended for discussion and exchange of views rather than an expert opinion. This is not an recommendation to buy or sell or invest in t
Read more

Bank Nifty 10th Nov

Image
Commentary On Index: Date : 10th Nov Day Stats : A bullish day with a gain of 207 points.   Day: Up Day Candle pattern:   Bullish Candle after a neutral candle confirm trend reversal. Healthy long body with very small lower wick and  small upper wick i.e. opened near the low and closed near the high.  Range: Wide ... indicating demand exceeded supply Volume:  Improved from last two/three days and closer to average (though slightly below average) BANK NIFTY COMPONENT STRENGTH SCORE 10 NOV 17* Component Strength Score : 54.75 EMA : 55.13 Interpretation : Neutral/Sideways. Candle indicating gathering of bullish momentum. *ABOUT COMPONENT STRENGTH SCORE I am experimenting and developing a Component Strength Score based on the study of the underlying constituents of the Index itself. I have started with Bank Nifty. Here is a WIP version. The graph has three data points The movement of BN itself (absolute points), then there is a Component str
Read more