Trade set up 03 Sep 2018

 

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 rise)
  • The difference between bank nifty's future and spot (Basis) is now 154 points. The basis has risen from last day about 37points. Toay is high chance that BASIS will fall.
  • Bottom Line :
  • The Trend is down.>>GOOD set up to SELL>> Basis rise.

2. sentiments

  • Global markets:
  • The Asian market is mostly down+ USA future market is flat+ but DAX future is creacked!
  • what is news on TV
  • GDP data is lag data, so it may use to book profit!
  • Positive newsflow:
  • GDP data is great, but it may not full advantage to bulls.
  • Negative newsflow:
  • Bank nifty is slightly weaker de to micro! & Rate hike chances is higher due to good growth!
  • 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 m selling at opening gp up
  • EXIT:
  • if my selling work, I hold he position till noon.
 

Abhikumar Patel
Twitter

1 Like

DAX flat now i checked just now only, was it down before?

, I m sorry I SAW last day rate!

But my view remain the same. It is not major factor in my calulation!

Abhikumar