Trade Set up 27 Aug 2018

 

1. SET UP to TRADE BANK NIFTY

  • Trend: (⇑-Up Trend )
  • Bank Nifty is in the Mid phase of Bullish Trend. Buyers/ demand are Still in control of a market today.
  • Market set up : (⇑- Supportive to trend )
  • Today Bank nifty Force set up is "very much Supportive" for Buying. So, Today is "Great set up" to buy. Today, you should not miss the opportunity on the upside.
  • F&O trader position: (⇑ - Basis rise )
  • The difference between bank nifty's future and spot (Basis) is now 74 points. The basis has risen from last day about 2 points.
  • Bottom Line :
  • The Trend is up.>> best set up to buy>> Basis rise.

2. sentiments

  • Global markets:
  • Asian market very much positive+ USA future is also trading positive
  • what is news on TV
  • Bank nifty lead the way n upside today. Powell says " hikes will be gredual in USA". Market in point where you buying make sense.
  • Positive newsflow:
  • doller has fallen, thus rupee is appriciated - again good for banks
  • Negative newsflow:
  • Crude is 76 is some big headwind which is nagatve for Bank nifty.
  • Bottom Line:
  • sentments is very much positive

3. Game theory ( tug of war between buyer & seller)

  • From where New Buying comes?
  • A. Since sentiments are Vey much Positive, the Outside trader will Buy with very much aggression. B. Trader's with short Position- Great chance for short covering today.
  • From where new selling come:
  • A. Outside trader will not try to short sell at all today.
  • Will buyers buys on dips?:
  • On Fall- Since the Trend is up, There will be a higher number of buyers at the lower end which propels the market to go up from dips. Moreover, at dips sellers who wanted to sell has sold off. So buying on dips is the dominant strategy as More buyer and lack of seller at the bottom of uptrend market
  • Will Seller sell on rise?

4. what I am going to do today (In bank nifty)

  • Set up:
  • Today Bank nifty Force set up is "very much Supportive" for Buying. So, Today is "Great set up" to buy. Today, you should not miss the opportunity on the upside.
  • Sentiments:
  • sentments is very much positive
  • EDGE:
  • My today trading edge points clubbing setup & sentiments is 130 .Since my trading edge is more than 50, I will look for buying opportunity only.
  • ENTRY on edge:
  • Buy at open in bank nifty( If it open less than 150+ gap up)
  • EXIT:
  • Hold the position till End of day!
 

Abhikumar Patel
Twitter

1 Like

How you know entry and exit points?

Bank Nifty had correction of 500 points last week.

After a series of “Red” days if an index opens gap up, you go long blindly at market opening.