Banknifty Update May-20, 2020

In yesterday's post, I mentioned that Banknifty may remain rangebound in 18000--17200. Today it opened Gap up @ 18037, immediately come down to 17600 levels, our Gann No and again gave good up-move making day high @ 18175 and then again back to 17600, broke it, made low of 17390. It eventually closed @ 17486. So it behaved exactly in the range as we expected, giving good opportunities for trading.

On the daily chart, MACD is clearly showing the breakdown. In this entire retracement upmove, MACD did not cross the "0" level and now gave bearish crossover. Similarly, RSI was rangebound in the 40-50 zone during retracement move. Now it also broke 40 levels.

Breaking 17200 levels will give us a target of 15000 levels in the coming weeks, near our next important Gann Number for Banknifty, 15100. In the Month of May, Banknifty opened near Gann Number 20400, achieved the next major Gann Number level 17600. So now the next target as per this system is 15100. So let's wait and watch.

The hourly chart is showing that today's price reversed from the Neckline zone of the H&S pattern. Also observe "Bullish Divergence" in MACD Histogram (shown in line form), which suggests possible upmove on the hourly time frame. I am expecting a rangebound move for the next 1-2 days within the channel(brown color) shown.

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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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