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Daily Market Analysis 30 Jan 2023 Monday

Market Structure : Bearish / Sell on Rise

Nifty Analysis :

1. On Friday, Nifty broke the Bearish Descending Triangle. See Hourly Chart Below.
2. Height of this triangle is around 800 points, so this pattern’s target should be same as 800 points from the breakdown points.
3. Breakdown point is 17760 on spot, 800 points from here will be around 17000.
4. And one more interesting thing, I’ve explained this in Nifty Long Term View. Nifty is around the support level, Which is roughly around 17200 to 17000. See Daily Chart Below.
5. If that level sustains, then Nifty will be in Uptrend. If that level breaks, Nifty may see further selling.

Nifty Weekly Options Data :

1. In Weekly Options, Option Sellers added heavy calls at 18000
2. So that means Option Sellers are expecting that Nifty is going to close below 18000 for this expiry.
3. Option Sellers haven’t added not much puts.
4. Put Call Ratio is around 0.51, which is a bearish sign.
5. Nifty Weekly ATM Straddle premium is around 360 points.

Nifty Monthly Options Data :

1. In Monthly Options, Option Sellers added Short Straddles at 18000
2. Strong Puts can be seen at 17500 and 17000
3. Put Call Ratio is around 1.34, which is Bullish sign for Month End Expiry.
4. This is my expectation, Option sellers may be writing these options in Monthly Expiry because of Rising VIX. So that they can get big profit, when these options expire worthless.
5. As discussed above in Nifty Analysis section, there is a support around 17200 to 17000 in Long Term. Based on this Monthly option chain data, I’m expecting 17200 to 17000 level may sustain.
6. Nifty Monthly ATM Straddle premium is around 650 points.

Bank Nifty Analysis :

1. Bank Nifty opened with Breakaway gap, started falling continuously.
2. Bank Nifty also broke the Bearish Descending Triangle. See Hourly Chart Below.
3. Height of this triangle is around 2200 to 2300 points, so we may expect 2200 to 2300 points from the breakdown points.
4. But almost more than 50% of the target already achieved.
5. I’ve marked a selling zone for Bank Nifty. If Bank Nifty comes into this range, this level should be treaed as selling opportunity. See 15 minutes Chart Below.
6. I’ve added Bank Nifty Long Term Daily Chart below, Bank Nifty trading at reasonable distance from the support level. See Daily Chart Below.

Bank Nifty Weekly Options Data :

1. In Weekly Options, Option Sellers added 42000 calls heavily
2. Not much puts can be seen below that level.
3. Put Call Ratio is around 0.43, which is a bearish sign for this Expiry.
4. Bank Nifty Weekly ATM Straddle premium is around 1100 to 1200 points.
5. I remember, Last year on Budget Day Bank Nifty ATM Straddle premium is around 1400 to 1500 points.

Bank Nifty Monthly Options Data :

1. In Monthly Expiry, Option Sellers are creating Short Straddles at every 500 points distance.
2. That means option sellers are expecting, Bank Nifty will close with in this range for this monthly expiry.
3. It may be also because of the premium available for option Sellers, because of raising VIX, these options sellers can write these options at higher premium.
4. Bank Nifty Monthly ATM Straddle premium is around 1900 to 2000 points.

Final Thoughts :

1. Nifty and Bank Nifty both broke Bearish Descending triangle. See Hourly Charts above.
2. Target for this pattern should be same as height of the triangle.
3. Nifty and Bank Nifty both are still in Uptrend in Long Term. See Daily Charts above.
4. Option Premiums are ultra high because of Budget.
5. As per options data, Weekly options data is bearish.
6. In Monthly options, Option Sellers are not that bearish.

After I’ve seen that options premium is increasing, I’ve updated it in telegram channel. Later on also premium increased a lot in Intraday. See the Pic Below

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.