Bank Nifty EOD Update Feb 8 - Post RBI No Rate Cut

Post RBI decision on rate cut, Bank Nifty corrected to 20070 and bounced back . It is not surprising that even after bad news of no rate cut, it bounced back from low and closed at 20245. But now it is at crucial juncture of 20400. So it is now case of a make or a break for Bank Nifty! Why? Let us understand from following chart:

Chart shows from Sep 07 top(20576), Index moved to 17600 between a major solar cycle (Sep 22 to Dec 22). The nos 204(00) and 176(00) are important levels as they are consecutive Gann Nos of 180 deg (176 & 204)

Post low of 17600 (on Dec 26, close to Dec 22 cycle start), Bank Nifty moved up so quickly that it reached back to 20400 even before start of minor cycle (Feb 4) and now facing resistance at 20400. So if it not able to cross 20400 convincingly and hold above it, Bank Nifty may slide to 19700/19000 and may even go back to 17600 very sharply.

So next 2-3 days would need caution if Bank Nifty struggles at 20400 level. If it breaks 20400 decisively next level could be 233(00) that next Gann No in 180 degree above 204.

Hourly chart shows Bank Nifty bounced back from lower line of red channel. I marked 22 bars of correction time and it took exact time to complete correction. Tomorrow bank Nifty may reach 20400/20500 level and may face resistance at 20576(High of Sep 07). If it decisively breaks it then 20700/20800 is possible.

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VIX Analysis

The daily VIX chart shows the formation of Doji candles at the bottom and reversal. The daily RSI crossed the previous resistance level of 40. The MACD signal gave bullish crossover suggesting bullish move in VIX. So the daily chart shows the possibility of VIX moving towards 28 levels in the coming days. The weekly chart shows the formation of wedge and reversal from the bottom. VIX may move towards the upper wedge line @ 29-30. So VIX suggesting the bearish mood of the market and hence the high possibility of fall in Nifty-50 and Banknifty in the coming days/weeks. VIX Gann Box: The daily Gann Box shows a reversal from the mid-zone of time factor points. The next time factor date is Jul-21. So will VIX continue to move high till Jul-21 or it will reverse from angle point? Wait and watch. Using VIX to spot Intraday Reversal on Indices: VIX is a very useful indicator to spot reversal during day trade. If the price of an index moves up and @ resistance zone watch values of VIX. If VIX s...

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BankNifty Update For Jul-09,2020 - Weekly Expiry

Banknifty opened Gap up @ 22700 and then achieved all our bullish targets of 23900/23000. But the upmove was very choppy and looked like terminating pattern and was not easy to trade. So I did not take a trade on the upside. My observation was Banknifty good up (250-300 points) while Nifty was not at all moving up and was just 10-15 points up and VIX was increasing. That was a signal that there is a high probability of reversal. (I twitted this around 12.30 pm). Banknifty continued its upmove and VIX was not falling, so I was sure that reversal is on the card from the strong resistance zone of 23900-23000/50. In yesterday's post, I mentioned about daily RSI @ resistance. That was another reason I was expecting a high probability of fall after it moved higher levels to come to at least yesterday's close levels or below. I got down-trade from almost 23000 to 22700 (got out earlier as it was intraday and not much time left though I was expecting at least 22600. It gave a much lowe...

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