1. SET UP to TRADE BANK NIFTY
- Trend: (/⇓ - downtrend) Bank Nifty is in initial phase of Bearish Trend. So, Supply is in total control of market today. Seller will have their dominance over demand.
- Market set up : (⇑- Supportive to trend ) Today Bank Nifty Force set up is "Supportive" for Selling. So, Today is "Good set up" to Sell. You should look for Selling opportunity.
- F&O trader position: (⇓- Basis is down ) The difference between bank nifty's future and spot (Basis) is now 26 points. The basis has fallen from last day about -16 points.
- Bottom Line : The Trend is down.>>GOOD set up to SELL>>Basis fall.
2. sentiments
- Global markets: The Asian market is down + Dow future is also trading on red
- what is news on TV Ruppe is main focus area! If rupee depreciates further, then it is worrisome for the market!
- Positive newsflow: Canada could join USA Bilateral. morgan Stanley may upgrade Indian Corporate bank. Growth is not the problem.
- Negative newsflow: The currency has slided so much! & Crude is up!
- Bottom Line: Sentiments is mild negative. Sentiments is also supportive to Down trend.
3. Game theory ( tug of war between buyer & seller)
- From where New Buying comes? A. Since sentiments are mild negative, the Outside trader may not buy today.
- From where new selling come: A. Outside trader-Mild new short selling expected from outside traders. B. Trader's with Long Position- GOOD chance for Long unwind today.
- Will buyers buys on dips?:
- Will Seller sell on rise? On rise-Since trend is Down, There will be a higher number of sellers at higher end which propels the market to go down on the intraday rise. Moreover, on Rise, a buyer who wanted to buy has already bought. So Selling on the rise is a dominant strategy as more seller & lack of buyer on rising of downtrend market
4. what I am going to do today (In bank nifty)
- Set up: Today Bank Nifty Force set up is "Supportive" for Selling. So, Today is "Good set up" to Sell. You should look for Selling opportunity.
- Sentiments: sentiments is mild negative
- EDGE: My today trading edge points clubbing setup & sentiments is -110 .Since my edge is less than -50m I will be only looking for shorting opportunity for today.
- ENTRY on edge: I will short at Open ( If bank nifty open round 50+ gap up)
- EXIT: I amy hold my position as long as it is woking! ( May be til noon)
Abhikumar Patel
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