Nifty Daily Update 21 Sept 2017. 3rd day of fall.

BIG PICTURE SEPT 21st

The Nifty lost another 19.25 points for the 3rd consecutive day after Nifty managed to break the All time High of 10137.85 mark.  All broad based indices closed in the red and sectoral indices also ended in the red except for Pharma which gained a whopping 3.33% in the trading session. IT marginally gained 0.02 to give company to Pharma.  Top 2 losers were Media and Realty.

The advance decline ratio was 1:2 negative bias. 56 securities reached 52 week high while 15 securities reached 52 week low in the day's session.

The trading range for the day was very broad more than 100 points in contrast to the last two days of narrow range trading sessions.

CANDLE STICK ANALYSIS

• A third consecutive day of lower close and bearish candle for the Nifty 
• Volumes were average.
• The market opened bullish above yesterday's close and reached the high of the day.
• The selling started within the first hour relentlessly to take the market more than 100 points lower.
• Then it was a slow climb back to yesterday's close when another bout of selling ensured a bearish candle with a body of about 18 points versus a day range of 100 points.
• The resultant pattern was a Hammer (short upper shadow, long lower shadow and small body), at the bottom of the three days of fall. 
• This is a bullish reversal pattern as Bulls managed to reject the lower levels below 10000 and closed near the previous high.

INDIA VIX AND NIFTY OPTIONS DATA 

The India Vix after bottoming out and starting to look bearish formed a perfect doji today with open and close at 11.6325 while the high and low of the day was close to 3 points (or 25% of the index value). This indicates a neutral and indecisiveness in the Options market. As the expiry is a week away, it is interesting for the market to form this perfect DOJI.

A look at the options turnover indicates a high trading levels in Options. A total of 1.49 million puts were traded and 1.40 million calls were traded (nearly 1:1 PCR on traded volumes). The PCR has now fallen to 1.34 from above 1.5 levels. A look at the individual strike prices on the put side indicates short covering of ITM Puts and unwinding of OTM Puts. A look at the call side indicates short build up at 10100 levels of more than 1 million puts and unwinding at 10K and below levels. The OTM calls showed unwinding during the day.

Based on max OI the 9900 to 10200 seem to be the support and resistance for Nifty. The broadening of the range on the lower side is interesting even as the price action is indicating a bullish reversal pattern.

OUTLOOK FOR 22 Sep

22nd Sept Nifty Range 10085 to 10185 with support at 9995 and resistance at 10200 levels. 

22nd Sept Bank Nifty Range 24576 to 25022 with support at 24455 and resistance at 25137 levels.

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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.