Opening Day Fatigue Leads to A Flat Close for the Indices [6-6-22]
NIFTY O / H / L / C
16530.75/ 16610.95/ 16444.55/ 16569.55 [-14.75/-0.09%]
BANK NIFTY O / H / L / C
35159.15/ 35424.50/ 35072.30/ 35310.20 [+35.15/+0.10%]
20.20/+1.10%
FII DII Data Crores
SGX @ 1815h Flat
TOP 5 CONTRIBUTORS OF NIFTY
lifters 23
Dragers 26
net-03
TOP 3 CONTRIBUTORS OF BANK NIFTY
lifters 82
Dragers 55
Net +27
CHART BASED DETAILS & ANALYSIS are GIVEN IN THIS VIDEO: https://youtu.be/hSVWZTHwh1g
POSITIVES
ended in the green.
Infosys (NS:) ended in the green.
NEGATIVE
Nifty ended below the previous close of 16584.
Indian Vix has inched up above 20.
SUPPORTS & RESISTANCE LEVELS
Nifty – Support 16200-16400 Resistance 16650-16700-750
Bank Nifty – Support 34800-35000 Resistance 35400-600-800-36000
TRADING INSIGHTS & OBSERVATIONS
- The Asian markets were mixed and the US Futures were trading in the green after a red close to the week, and our indices followed the Asian markets as the major players have a bias toward the red color for now. Also, the FIIs had been net sellers on 3-6 so the down move was on the cards.
- Nifty opened with a mild gap-down and then tried to bounce back, but could not even test the close of 3-6, and started losing the grip and in the next 15 minutes or so, it lost 100 points in a very volatile opening hour.
- As I had mentioned in one of the videos released over the weekend, Nifty may retest the 16400-450 area and it did so and created the AM session low at 16444. One more coincidence is that it happened to be a few fractions away from the low for 3-6.
- Initially, the banks appeared to be relatively comfortable as HDFC Bank (NS:) was holding up, but then Bank Nifty also found it hard to sustain higher levels and after registering its opening high just above 35400, it fell more than 300 points which is what made things hard for Nifty.
- Nifty was already under pressure from the IT twins as they were the lead draggers of Nifty in terms of weight, After a while, Reliance (NS:) also started to fall which added to the pressure on Nifty. Ut then started to fight a hard battle between 16480-16530.
- The above ensured that the India Vix was comfortably above 20 in the opening hour and remained so, making the moves choppy.
- Soon after 1130h, Nifty found good buying interest at 16500, and over the course of the next 3 hours, Nifty labored to cross 16600 and registered what turned out to be the day’s high at 16610. Earlier in the day, Infosys was the lead dragger and then it helped Nifty bounce back as it was up 2%+ from the day’s low.
- Like a copybook resistance trade, Nifty found resistance around 16600 and for the last hour of the session, trading in a narrow range of 50+ points below 16610. And it ended flat at 16569. As against that, Bank Nifty managed to end at 35310 , a few points on the green.
- There was a hard-fought battle for the previous close of 16584 and it seems that the area has some significance. Also, Nifty running down to 16450 zone and Bank Nifty running down to 35000 on a regular basis is not a good sign. If the areas keep getting tested without the indices drawing sound support, these may end up being breached.
- RBI policy is due this week so the indices may be cautious ahead of the meeting which is likely to further increase the rate. Once the expected hike is out of the way, the indices are likely to make a decisive move on either side – for the Nifty the crucial level is 16400, and for Bank Nifty 35000.
- There was hardly any significant contribution from any of the heavyweights, but Bank Nifty managed to end in the green despite HDFC (NS:) Bank ending the day in red is a welcome change.
Note: Posted purely for informational & educational purposes only. I am not SEBI Regd.
