As expected Bank nifty gap'd down and opened at 440889, but as unexpected BN rose to fill up the gap till 9.35. And what happened from 9.40 to 10.40 was again as expected wherein the BN falls to the support and then makes a pause. Infact what even happened from 11.05 to 12.40 was as planned. But what really shocked was the move from 12.45 to 14.05.
I had purchased a 40300/40200 debit spread and it was spiking in premium - i never even thought that BN will take support at 40360 level. I was not just worried that the trade didnt work out - but i was not expecting a pullback at that level because i had not marked it as a valid SR. Bank nifty rallied up 533pts from the intraday low passing through the resistance line at 40691.
The final close was just below this SR line. Now BN has broken 2 support lines in the last 2 days - its time to get a bit cautious and check if its a trend reversal in 5mts TF.
Overall the Nifty50 index just fell .5% compared to the 1.7% fall in the SPX overnight. I am pretty bored to highlight the nifty & bank nifty out-performance compared to the Global indices over and over in the last many articles. May be we will have a 5 or 10% intraday fall here just to align our market with the global peers.
I am more worried about the bulls who are trading everyday with the false belief that our markets are buoyant and recession proof.
A possible double top formation in the 5mts chart. If the index keeps breaking support levels then we can confirm its a bullish reversal.
1hr timeframe has not confirmed a bullish reversal yet. But the double top is starting to get visible.
Bank nifty important support and resistance lines
s1:40149, s2: 39739
r1: 40689
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