PostMortem on BankNifty Today & Analysis of 13 DEC 2022

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A gap up opening with a bullish 5mts candle to take out the all time high. And then a steady rally till 12.10 setting a fresh new high of 43983. Bank nifty had good bull momentum to take out the swing high of 9th Dec.

There was a small profit taking from 12.15 to 14.40 but this failed to take out the high of the opening candle — again showing strong long only momentum.

Also the bias has now shifted to long only as the resistance band is also taken out. Usually all the analysts will give bullish calls on bank nifty — thats because almost all the technical indicators shows buy signal — see the investing technical indicators shown below for the 5mts, 1hr and 1D time frames.

But i personally remain cautious at ATH and ATLs because there could be a minor contrarian move just to check if there are weak hands. Also its not advised to buy at all time highs and then expect a great return from that point onwards.

5mts TF
1hr TF
1D TF

Of the bank nifty components:

  • HDFC Bk had a gap up and then fell from that point gradually. The last 10mts candle had pretty deep cut.

  • ICICI bank went up continuing from the trend yesterday, hit HOD at 12.05 and then fell underwater. The final 35mts it gained back to end positively.

  • SBI had a gap up opening but the chart pattern shows continuity and this gap is not easily noticeable. Final close was also positive

  • AXIS had a surge opening 30mts and then traded in the same range till 12.05. A small pull back but the final close was in positive territory.

  • Kotak was the only bank to have a gap down opening, trade underwater till 11.35 and then a minor upmove to end flattish.

  • IndusInd continued moving upwards, the last 30mts surge was accompanied by good volumes

15mts and 1hr TF both looks bullish — but i personally will not get into a long trade now. would prefer to wait out as even a FOMO moment will not distract me

There are 2 view points if the US CPI comes in lower than expected. 

  1. The US market will rally, ensuring that the emerging markets like India will follow suit and rally

  2. The US market will rally and the FIIs would love to go back to their home market. They may prefer to exit Indian markets as they have given a good return for the year so far !

What the FED does with the interest rate & liquidity removal are the actual drivers.

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