Today's move in Bank nifty quite opposite to the one we had yesterday. Opened at 41282 gap down, just below the support line 41312, rallied & filled the gap in the first candle and then gave it away. Made an interim low at 10.05 rallied back the SR line and then made a lower swing to intraday low at 12.25. This swing ensured that the gap up of yesterday was negated.
The final close 41197 was below the SR line. So yesterday's support became today's resistance. The fall today may have been due to the Russia adding troops in Ukraine (may be seen as a war escalation). But when viewing the chart - it shows a smooth trend consolidation pattern.
Ideally bank nifty & nifty50 should have fallen if we are going in accordance with the S&P500 (fell 1.13% yesterday), but our markets are again showing great resilience. Also today's intraday reversal did not come at a marked SR level so we might have that tested tomorrow or the coming days.
The easiest way for our indices to move now is Gap-Up or Gap-Down, because the effort required to take out the SR levels during the day is quite high and the indices are looking exhausted. And looks like we might have it tomorrow after the FOMC meeting today & the FED Interest rate decision.
What is quite surprising now is that 2Y and 5Y US bonds are offering yields close to 4%, much similar to the 90 to 180 days term rates offered by ICICI Bank, SBI Bank and HDFC Bank. The high bond yields will suck out the money from the equity market soon. If RBI ensures similar stand our India specific bond market yields also may go up.
Imagine if India offers 8 to 10% yield on 2,10 or 30 year tenure - our stock markets also will react inversely.
Consolidation is starting to be visible on the 5mts chart when viewed with the previous days together
However the 1hr chart is still bullish.
Bank nifty important support and resistance lines
s1:40689, s2: 40149
r1: 41312
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