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Daily Market Analysis 27 Jan 2023 Friday

Market Structure : Bearish / Sell on Rise

Nifty Analysis :

1. Nifty and Bank Nifty faced heavy selling pressure after breaking the yesterday’s low.
2. Nifty closed in the Weekly range, as of today’s closing Nifty is in bearish mode.
3. To continue further selling pressure, Nifty should break the today’s low and the Weekly low of 17760 in spot.
4. If the Weekly low breaks then we may see a further fall on the downside.
5. If the Weekly low not able to break, then the opposite also may happen.
6. Nifty is still in Bearish Descending Triangle.
7. We may see clear trend in Nifty, On or before Budget day.
8. I’ve added a selling zone in Nifty, If Nifty opens anywhere below this level and pulls back into this range, this will act as a Resistance. See 15 Minutes chart for Selling Zone.
9. Chances are very low, but if there is any gapup this level will act as support.

Nifty Weekly Options Data :

1. Option Sellers are writing calls at 18000 and above.
2. Option Sellers are creating Short Straddles at 18000 and 17900 with slightly higher calls.
3. Put Call Ratio is at 0.6, which is bearish sign.
4. 17900 ATM straddle premium is around 310, so as per option sellers expected momentum is till 18200 to 17600.

Bank Nifty Analysis :

1. Bank Nifty exactly rejected from the upper trendline (discussed about this in Wednesday’s Bank Nifty Analysis) and fell beyond the Weekly low.
2. Currently Bank Nifty is trading at Monthly low, If this low breaks we may see further selling pressure in Bank Nifty.
3. As with today’s closing, Bank Nifty is also clearly in Bearish trend and the theme should be sell on rallies.
4. Bank Nifty is also in Bearish Descending Triangle.
5. I’ve added a selling zone in Bank Nifty, if market opens anywhere below this zone and pulls back into this zone. This level will act as selling opportunity. See 15 Minutes Chart.
6. If the day’s low breaks in Bank Nifty, we may see further selling pressure which is also monthly low.

Bank Nifty Weekly Options Data :

1. Option Sellers added Calls heavily at 42000 and above.
2. Option Sellers also created Short Straddles at 42000 with slightly extra calls.
3. Put Call Ratio is 0.51, which is a bearish sign.
4. 41700 ATM Straddle premium is around 900, so as per option sellers expected momentum is till 42600 and 40800.

Final Thoughts :

1. Nifty and Bank Nifty both are in Bearish mode. And in Bearish Descending Triangle.
2. But to see Further selling pressure, Nifty and Bank Nifty should break the low once again.
3. Tomorrow may continue the trend if the low breaks or may be sideways day if the low is not able to break.
4. Weekly options data is also suggesting a Bearish sign.
5. I’ve provided the selling zones for both Nifty and Bank Nifty if there is any pullback, See 15 Minutes pic above.
6. We may see clear trend in Nifty and Bank Nifty, On or before Budget day.

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.