Indices Weaken as Nifty Creates a new Swing Low, will it Hold 15659 for now?

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NIFTY O / H / L / C

15674.25/ 15858.00/ 15659.45/ 15732.10 [-42.30/-0.27%]

BANK NIFTY O / H / L / C

33180.80/ 33618.15/ 33123.90/ 33311.35 [-94.50/-0.28%]

India Vix 21.89/-2.15%

FII DII Data Not yet available

SGX Nifty @ 1710h -43

TOP 5 CONTRIBUTORS OF NIFTY

Lifters 29

Draggers 62

Net -33

TOP 3 CONTRIBUTORS OF BANK NIFTY

Lifters 65

Draggers 181

Net -116

CHART BASED DETAILS & ANALYSIS IS GIVEN IN THIS VIDEO: https://youtu.be/im9wdas5Ju0

POSITIVES

Infosys (NS: INFY ), State Bank Of India (NS: SBI ), Kotak Mahindra Bank Ltd (NS: KTKM ), and Axis Bank (NS: AXBK ) ended the day in the green.

NEGATIVE

Reliance (NS: RELI ), and the HDFC (NS: HDFC ) twins dragged the indices and did not allow a green close for the indices.

SUPPORTS & RESISTANCE LEVELS

I will venture in to drawing the lines only based on the close for the week.

TRADING INSIGHTS & OBSERVATIONS

  1. Nifty opened with a gap down of -0.63% and Bank Nifty opened with a gap down of 0.67%. This meant that another red numbers day was on the cards. However, there was a silver lining in respect of Nifty as the Open was equal to Low which is a bullish sign.
  2. And Nifty did not disappoint the participants and the followers of this approach as in the first 5 minutes itself it shot up to 75+ points and tried to retest the previous close. However, the FIIs had sold heavily yesterday so they would not allow such an incident to happen at the open and then the selling started.
  3. Within the next 10 minutes, the Nifty fell more than 100 points and broke with ease the Mar 2020 swing low at 15671 and created a new low at 15659. The most important point now is that will this remain the low for the day and in due course of time, the new swing low?
  4. And after shaking off the Open = High bulls, Nifty shook off the shorters and there was a sustained spike over the next 2 hours plus that saw Nifty jump a little less than 200 points. Nifty had to struggle for some time just below the earlier close and just when it looked it may not be able to cross the line, Nifty not only crossed the line but also hit 15800 as well as crossed 15850.
  5. It then went sideways as it was now in double mind - what to do next? Wait for the FTSE to open or simply make a dash towards 15900?
  6. The positivity in the indices was on account of the positive stride shown by the US Futures, however, it was strange to see that the Asian Markets were in significant red and yet the Nifty turned positive. Maybe it would wait for the FTSE to guide how soon it can once again turn red.
  7. Just ahead of the FTSE open, Nifty had a premonition and it broke 15800 with super ease and came very close to the previous close. It then waIted for the cues from the FTSE and when it was in the green, Nifty waited for a while and then followed the weakening US Futures and the Asian markets.
  8. In the process, Nifty came towards 15720 from where it found support and hit the 15800 area but the pressure was too much to handle and then within the next one hour, Nifty fell 120 points and found support at 15679 and from their crawled its way to 15700+ and finally managed to end the day at 15732.
  9. There was no last-hour sharp recovery which indicates that the DIIs either do not see that this is the end of the downfall or they need to sell some more holdings to generate funds to go long. Both the ways, it does not look good for the markets.
  10. Even after hitting a high of 15858, the Nifty fell 175+ points indicating that it is suffering from cold at higher levels and is uncomfortable even above 15750. The low for the day is a new low for 2022 and we have to see if Nifty is able to hold on to that low and if so, for how long?
  11. Bank Nifty was under pressure as the ace heavyweight, HDFC Bank (NS: HDBK ) was dragging the indices. HDFC and Reliance also joined and they ensured that the indices close even below their respective previous close. Infosys was the lone heavyweight that helped Nifty from falling further.
  12. The India Vix has fallen, but only 2%+ and is just below 22. So it is still likely to be a choppy ride tomorrow. Unless of course, a sharp gap-up of 200+ points is held on to in Nifty - with the markets, anything is a possibility!

Note: Posted purely for informational & educational purposes only.

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  • Uday Kumar @Uday Kumar
    good analysis
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    • Umesh Rindani @Umesh Rindani
      Thank you
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  • Uday Kumar @Uday Kumar
    good analysis
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  • Uday Kumar @Uday Kumar
    good analysis
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  • Rajesh Pahuja @Rajesh Pahuja
    good
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    • Umesh Rindani @Umesh Rindani
      Thank you
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    • Umesh Rindani @Umesh Rindani
      Thank you
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  • Ashish 6265 @Ashish 6265
    Nicss
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    • Umesh Rindani @Umesh Rindani
      Thank you
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