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Daily Market Analysis 25 Jan 2023 Wednesday

Market Structure : Bullish / Buy on Dips

Nifty Analysis :

1. Nifty closed negative today (closed exactly at previous day’s closing), but Nifty is trading around upper band of Weekly range and above upper trendline.
2. Even with today’s closing Nifty is looking bullish in short term. If tomorrow’s session closes in negative, then the trend will turn into bearish.
3. Currently Nifty is trading at make or break level, If it’s going to go up Nifty should break and sustain above upper band of Weekly range.
4. If not Nifty may retest the upward sloping trendline or weekly low once again.
5. 18200 to 18250 is a resistance level, consolidation around this level is good for the breakout.

Nifty Monthly Options Data :

1. Option Sellers added heavy calls at 18100 and above.
2. Put sellers unwinded 17700 and below.
3. Put Call Ratio for tomorrow’s expiry is 0.67, which is a bearish sign.
4. 18100 atm straddles premium in 90 to 100, that means options sellers will get into trouble if market moves beyond 18200 and 18000.
5. If these sellers sold Short straddles from a premium of 200 or above, then there won’t be any problem for them.

Nifty Next Weekly Options Data :

1. For next Weekly expiry also, Option Sellers are maintaining 18100 Short Straddles.
2. After that next highest OI is at 18200 Call
3. Put Call Ratio is at 0.93, which is neutral or slightly bearish for next expiry.
4. We will get clear idea of Next Week’s Option chain after tomorrow’s trading.

Bank Nifty Analysis :

1. Bank Nifty rejected exactly from the upper trendline.
2. Bank Nifty closed negative compare to nifty.
3. Tomorrow’s session is important for Bank Nifty, If tomorrow’s session also closes in negative.
4. Then Bank Nifty may retest the upward sloping trendline or Weekly low once again.
5. If the Upper trendline breaks and closes above it on daily timeframe, then there is no need to be on bearish side.

Bank Nifty Monthly Options Data :

1. Option Sellers added heavy calls today in Intraday.
2. Highest calls are written at 43000.
3. After that, highest OI on put side is at 42500.
4. Put call ratio is at 0.71, which is a bearish sign.
5. As per Option Chain, option sellers are not expecting Bank Nifty to close above 43000.
6. If that happens, that will be a surprise and shock to those option sellers.

Bank Nifty Next Weekly Options Data :

1. For Next Week expiry also, option sellers are writing calls at 43000
2. After that call, major OI is at 42500 put.
3. Put Call Ratio is 0.9, which is neutral to slightly bearish.

Final Thoughts :

1. Nifty and Bank Nifty’s closing is negative for today.
2. Nifty closed flat almost at yesterday’s closing, But after that much gapup closing flat is not a good sign.
3. Compared to Nifty, Bank Nifty closed below yesterday’s closing. This is also not a good sign.
4. If there is no follow thorough on the down side, then there no need to worry. But Nifty and Bank Nifty both are trading at upper side of Weekly range.
5. And also option sellers are not expecting bullish momentum for tomorrow’s Expiry.
6. If tomorrow’s closing is also negative, then Nifty and Bank Nifty may retest upward sloping trendline or Weekly Low once again.
7. Consolidation at the breakout level is good for the Breakout.

If you are seeing anything else other than what I’m seeing from this data, post your view below in the comments section.

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Disclaimer : I’m not a SEBI registered analyst, these are my views only.