Trade set up 29 aug 2018

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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 "Supportive" for Buying. So, Today is "Good set up" to buy. Today you should "buy on dips" only.
  • F&O trader position: (⇑ - Basis rise )
    • The difference between bank nifty's future and spot (Basis) is now 42 points. The basis has risen from last day about 37points.
  • Bottom Line :
    • The Trend is up.>> Good set up to buy (buy on dips only)>> Basis rise.

2. sentiments

  • Global markets:
    • Asian market is positive+ dow jones is positive
  • what is news on TV
    • Trade war seems to be over- Positive. Minor dips can be use to buy in Bank nifty. Market is overbought,but still relly may continue!
  • Positive newsflow:
    • Growth is firing on all cyclnder on global market, FII buying continue.
  • Negative newsflow:
    • Asian currency is weaker, Indian currency may also weaken- Nagative for Bank. Bank nifty is finding some resistnce.
  • Bottom Line:
    • sentments is mild positive

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

  • From where New Buying comes?
    • A.Since sentiments are Mild Positive, the Outside trader will come and buy. B. Trader's with short Position- GOOD chance for short covering today.
  • From where new selling come:
    • A. Outside trader may not short sell 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 "Supportive" for Buying. So, Today is "Good set up" to buy. Today you should "buy on dips" only.
  • Sentiments:
    • sentments is mild positive
  • EDGE:
    • My today trading edge points clubbing setup & sentiments is 90 .Since my trading edge is more than 50, I will look for buying opportunity only.
  • ENTRY on edge:
    • Buy at open or open dips
  • EXIT:
    • Once I get my entry, I will hold the position for 100+ gain today
 

Abhikumar Patel
Twitter

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