NIFTY – Likely to hold 7600-7700 till F&O Expiry this week
Technical & Derivatives Analysis: 22th May 2016
It’s important to note that NIFTY Index could not cross April 2016 high during May series and reversed from 7940. It’s a clear weakness on the technical chart forming Lower Top and now ready to achieve Lower Bottom target.
However, expiry for the May 2016 F&O series is most likely to be near 7700 considering the Put options build up at 7700 strike. PCR is at 0.76, which is oversold situation. But there was unwinding in Put options across all strike prices except 7600. NIFTY definitely looks weak but may show some bounce from 7600-7700 before further downside. It will be interesting to watch Rollover for next series for the confirmation.
NIFTY confirms technical resistance on weekly chart
Technical & Derivatives Analysis: 10th April 2016
NIFTY, which rallied since the low made on the budget day seems to be losing the steam now. Weekly chart clearly show a bearish candlestick formation near the trend line resistance at 7800.
In the bottom part of the chart, one can clearly see significant decline in NFTY Future OI. This is an indication of unwinding of long positions and expects NIFTY to head southward, if it breaks crucial support at 7500. On last Friday there was unwinding seen at 7500 and 7400 strike price Put options. This is an early warning of breaking 7500-7400 support band in this series itself!
NIFTY Alert! Panic stampede, if 7500 broken today
Technical & Derivatives Analysis: 08 Jan 2016
This is an emergency update… Be alert, if NIFTY Index breaks 7500 level decisively, today. It will not be just a free fall but there will be panic stampede on Dalal Street!
As per the Put Options buildup in Derivatives, it shows 7500 level is the only support and there are no hopes below it. Closely watch, if Option Writers unwinds 7500 strike price Put options today. OI PCR is at 0.93 levels, which mean there is still more than sufficient room for the further fall in NIFTY. Be alert and NIFTY traders please get ready to take full advantage, if any there is a press of panic button below 7500. Watch this column for the next update.
NIFTY: Year 2016 – Make or Break!
Technical & Derivatives Analysis: 04 Jan 2016
Warm welcome to year 2016! Year 2015 was extremely important as we completed 8 years recurring cycle starting from Jan 2008. Now, 2016 is even more important because this is supposed to be Make or Break year from long term trading cycle’s point of view. NIFTY conquered height of 9100 level in 2015 but fizzled out from the top and tested 7500 level second time in December. This is just 23.6% Fibonacci Retracement level of the entire rally from the low of 2250 in Oct 2008 till the high of 9100 in March 2016. I consider this correction as just a tip of the iceberg and be prepare for more dip corrections as we enter into 2016. The immediate 38.2% Fibonacci Retracement level is at 6500 level. Don’t raise your eyebrows… technical chart shows it is very much possible in the 1st half of 2016..
However, I would urge NIFTY traders to be patient as Options buildup for January F&O series indicates that NIFTY is likely to trade in the range of 7800-8200. The IndiaVix is floating near support range of 13-14 level. Crossover above 15 will be the first symptom of good volatility with negative bias. The immediate trend line resistance is at 8100 and 200EMA is at 8067. The highest OI buildup for call options is at 8200. Therefore to conclude, I would prefer to go short in NIFTY as it enters into 8100-8200 zone with a target of 7800 for January 2016 F&O series.
NIFTY: Pullback over… Retest of 7500 in Nov F&O Series possible!
Technical & Derivatives Analysis: 02 Nov 2015
You don’t need to be so called Technical Analysis expert to read the below Weekly Chart for NIFTY Index. Index has formed Bearish long Marubozu candlestick on weekly channel line resistance and now nearly ready to fall till minimum 7500, which is previous low.
NIFTY: This is just a trailer… Picture abhi baaki hai!
Technical & Derivatives Analysis: 07 Sept 2015
Those who follow this blog regularly would remember at I had warned about game over for bulls in March 2015 when NIFTY was at its all-time high. Again in my previous update in mid-August, we saw clear Negative Divergence on Technical Charts and what happened next is not a surprise at all! Index closed for the week at 7655.
What’s next? Please see carefully the NIFTY Monthly chart since yea 2008, i.e. complete 8 year cycle starting from the low of 2252 in Oct’08 till today. Level 7500 is just 23.6 % retracement level of this bull rally till 9100. Below this, the next target is 38.2% retracement, which is at 6500 coinciding near previous bull market top. So, don’t be over optimistic and be prepared to see these levels by end 2015.
NIFTY: Negative Divergence on Technical Chart!
Technical & Derivatives Analysis: 16 August 2015
In my previous article, I had shown 8660 as resistance on technical chart and what happened since last 4 weeks is in front of you. Over last four weeks, NIFTY Index made multiple attempts to cross the resistance but failed. The high made was 8655 only!
What’s Next: You can clearly see that NIFTY Index is consolidating in a range of 8300 and 8660. However, technical indicators are showing Negative Divergence. Index is holding 8300 that is not making new low but RSI is making new low one after another. MFI is also clearly showing smart money is flowing out, which I have highlighted with red arrows.
Derivatives data is also giving similar clues. On Friday, index jumped by 150+ points but OI (Open Interest) declined by 4%, which is to my mind a very clear signal to sell on rise market conditions near 8660 resistance level.
NIFTY : Level 8660 & 8840 as Strong Resistance
Technical & Derivatives Analysis: 20 July 2015
NIFTY is struggling hard to keep its bullish momentum going. Bulls are just not ready to surrender against Bears and continued to bounce back from the support level in a range of 8000.
NIFTY Rollover % indicates more downside for May’2015 Series
Technical & Derivatives Analysis: 02 May 2015
“Game over for the Bulls” - that was the headline for my last article before April month began. I had also written that it will first trigger the stop losses for weak hearted short positions before showing its true color! And, what happened after that is all there in front of you. No ‘rocket science’ behind these predictions. A simple reading from Technical Chart and Insights derived from Derivatives Analysis….
What’s Next: Weekly chart clearly shows break below the trend line support. During the week it tested 23.6% Fibonacci Retracement level at 8150. Now, break below 8150 can take index to next target of 38.2% retracement, which is around 7570. Key derivatives indicator - PCR has reached oversold zone and therefore there could be some bounce back from the current level. However, 68% healthy Rollover number confirms continuation of downtrend and to my mind, any rise in the NIFTY Index would encourage bears to hammer the NIFTY more aggressively.
NIFTY under Dark Cloud Cover! Game Over for Bulls?
Technical & Derivatives Analysis: 30 Mar 2015
Note that the view provided in this particular week’s article is not just for a week or so but considering the timeframe for rest of the year 2015. NIFTY Index has raised an alarm on Long Term Technical Chart. On monthly Candlesticks Chart from Oct 2008 till Mar 2015, which is long 6+ year cycle, Index has formed extremely bearish Candles at the channel resistance.
February month formed a bearish ‘Hanging Man’ followed by bearish ‘Dark Cloud Cover’ candlestick in March. Hence, April 2015 month is extremely critical. NIFTY 200EMA at 8100 is the make or break level. Index must survive above this in April 2015 for bulls to keep their hopes alive. However, breaches 200EMA decisively will push market into deep long term correction cycle. For April 2015 series – the Rollover of Futures contract is at whopping 77%, indicating massive short build up for the series. But as you know, market does not allow people to make money easily. Therefore it is most likely to trigger the stop losses for weak hearted short positions before showing its true color! The pullback target is in the range of 8500-8600.
NIFTY: Achieved 8700, now approaching next target @8500
Technical & Derivatives Analysis: 16 Mar 2015
It was predicted at the beginning of the month that the trading range for NIFTY Index for March month is 9000 on upper side and the lower levels at 8700 and 8500.
On account of surprise from RBI, NIFTY did open at 9100 but as expected, came under tremendous profit booking, and closed below 9000. It first achieved 8700, bounced by around150 points and then finally broke 8700 on Friday. Index is now heading towards my next target of 8500. In the meantime the Options Writers are simultaneously building their potions around 8400 level as well.
So, keep watching this column for the next cues as Index approaches our target of 8500.
NIFTY Range for March 2015: 8500 – 9000
Technical & Derivatives Analysis: 02 Mar 2015
I had boldly written in my previous article that NIFTY won’t cross 9000 levels till budget day and results are now in front of you… There was no rocket science behind this prediction. It was simply based on Derivatives insights.
Now budget fever is over and sharp decline in Volatility Index suggest not to expect too much from the market for March series. The upper side remains capped around 9000 and the lower levels are 8700-8500.
NIFTY can’t cross 9000 till budget day event…
Technical & Derivatives Analysis: 22 Feb 2015
Majority of market participants are anxiously waiting for pre-budget rally. Options buyers are blindly betting on 9000 call options and at the same time Option Writers are coolly writing 9000 strike call! So, who do you think smarter? Needless to say that NIFTY is unlikely to cross 9000 level till last day of February derivatives contract expiry on Thursday, 26th.
Technically also the long red bearish Marubozu candle, which was formed on 30th January, is not so easy to cross. Hence, 9000 remains a strong resistance till budget day event.
Keep watching this column for budget day clues immediately after expiry day on Thursday 26….
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NIFTY Target Achieved… What’s next?
Technical & Derivatives Analysis: 08 Feb 2015
Last week I had given a target of 8630 based on the Options buildup and Fibonacci Retracement. During the week NIFTY Index reached exactly near this level and closed the week at 8660.
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NIFTY fails to break channel resistance… What’s next?
Technical & Derivatives Analysis: 02 Feb 2015
In my last week’s article I had shown how NIFTY index was approaching the channel line resistance. I had also written that the key derivatives indicators were signaling a fall but only after F&O expiry and exactly same thing happened on Friday.
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NIFTY: Approaching Channel line Resistance @ 8930
Technical & Derivatives Analysis: 27th January 2015
Market is on fire on the back of one after another sentiments boosting news. The NIFTY movement looks unstoppable, however Index is now approaching channel resistance which is around 8930 level.
Key derivatives indicator – OI PCR is in extremely overbought zone. The sudden drop in Call option IVs is signaling early warning. With only three trading sessions remaining for expiry, I don’t expect any sudden major price correction but keep close eye on NIFTY Rollover for the next cue for February month. At the moment 8930 seems to be technical resistance for the current up move.
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NIFTY: Heading towards upper channel line @8550-8650
Technical & Derivatives Analysis: 05 January 2015
December 2014 F&O series ended with flushing out weak hearted NIFTY traders from their long positions. However, healthy rollover at 66% was signaling positive bias on expiry day for January 2015. In fact most of the Technical as well as Derivatives indicators are now signaling continuation of positive bias for the coming weeks.
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NIFTY Options unwinding on Friday signaling range breakout?
Technical & Derivatives Analysis: 07 Dec 2014
I had earlier written in this column that 8500-8600 level is going to be acid test for NIFTY. Considering exceptionally high NIFTY rollover, I had also forecasted the outcome of RBI policy and results are in front of you. NIFTY traded in a narrow range of 8500-8600 for the entire week and gave tough time for intraday as well as positional NIFTY traders.
However, those who are monitoring Call/Put Options build up must have noticed a dramatic change in the writing pattern on Friday.
GOLD | Watch out 38.2% Fibonacci Retracement Support @ 24800
Record high 76% NIFTY Rollover, RBI Policy on 2nd Dec...
What to expect next?
Technical & Derivatives Analysis: 01 Dec 2014
NIFTY Index witnessed record high rollover at 76% for December 2014 Series. After expiry, NIFTY index kissed 8600 level immediately on next day and closed for the week on Friday just near the top. Market is propelling higher on rate cut hopes when RBI reviews the monetary policy on Tuesday, 2nd December. Record high rollover number indicates extreme bullishness among market participants.
Level 8500-8600, an Acid Test for NIFTY Index
Technical & Derivatives Analysis: 24th Nov 2014
I was expecting a bit of correction in NIFTY from 8400 level but Index did not give up on the gains and kept marching towards 8500 till Friday. Everyone seems to be bullish in anticipation of RBI monetary policy but Technical and Derivatives data is giving a signal of exhaustion for the Index. NIFTY needs to undergo an acid test before crossing 8500-8600 levels.
Key derivative indicator PCR (Put/Call Ratio) has entered into overbought zone. You can see in the above chart that Index is crawling upwards but OI (Open Interest) is constantly declining. Money Flow index is also showing –Ve divergence. As per Options build up, it is unlikely that Index will correct before expiry but fingers crossed for the December 2014 series! Keep close eye on NIFTY Rollover on expiry day for the next cue for Dec 2014…