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NIFTY 50 EOD ANALYSIS 24-2-22
In this post, I talk about the analysis for the day and the trading range for tomorrow. The video discusses with the help of the charts how the indices as well as leading stocks performed during the day and their likely play tomorrow.
O 16548.90
H 16705.25
L 17203.25
C 16247.95
EOD -815.30 points / -4.78%
SGX Nifty 23-2-22 @ 1800h = -119
FII DII = Not yet available
CHART BASED CONCLUSIONS using 5 Minutes Chart
opened with a gap-down of 500+ points but immediately found buying interest which took it up to the day’s high and then it fell 200+ points.
It then made a recovery of 175+ points but hit the resistance around 16650-675 and fell from there. It made a couple of failed attempts to bounce back from 16400 and rallied up to 16475-500.
However, in the last 90 minutes of play, it tanked more than 225+ points ended near the day low breaking all important supports.
NIFTY WEIGHT LIFTERS & DRAGGERS
Top 5 Lifters contributed = 00
Top 5 Draggers contributed = 294
Net = -294
BANK NIFTY WEIGHT LIFTERS & DRAGGERS
Top 3 Lifters contributed = 00
Top 3 Draggers contributed = 1356
Net = -1356
POSITIVES
If the markets had not been given 1530h cut-off time, they may have fallen further.
NEGATIVES
It is all about the negatives and nothing else. There is red color everywhere as there is no leader in either Nifty or – only laggards.
TRADING RANGE FOR 25 Feb 22
In view of the prevailing situation, I am not attempting to draw any lines of support and resistance. We may have to wait for a few days before cools down and when the situation on the global indices front also improves.
INSIGHTS / OBSERVATIONS
- I have been tracking the Indices since 24-9-21 and since then Nifty has opened below 17000 only on 4 occasions in Dec 21 and twice in Feb 22 including today’s opening. On the previous occasions on Dec 21, from those lower points – 16410 being the swing low, Nifty has hit 18000+ levels. Will this recur in the days and weeks to follow?
- Ignoring the 2020 lockdown era, I do not recall having seen such huge gap-down days. The only other time I recollect was post demonetization which coincided with Trump winning the elections.
- Also, ignoring the Covid era-related volatility, this is the first time that I have seen India VIX above 30+ and yet the movements are very slow and range-bound. The fear that was awaited has been met with and I am not sure what more the sentiments have to fear. It is only the aftermath of the event and that I suppose was the reason for the fear.
- Today was yet another day when our Indices appeared to have overreacted to the crisis in comparison to the global indices. More so when Russia assured that Indian defense ties would not be impacted.
- And as the situation on most of the down days, just as it looked that the indices appeared to be getting back up after being hammered down, they fell again breaching the morning lows. This time the fall may have been triggered by the FIIs as that is what they have been doing on a consistent basis.
- There will be little merit in looking at what the portfolio MTM would be and which scrips have tanked. On such days only the rare scrips that remain positive would be worth keeping an eye on. As I am writing this, Hindalco Industries Ltd. (NS:) is the lone Nifty 50 member that is non-negative. A commendable feat indeed.
- This expected yet unexpected fall on a Monthly Expiry day would have caused more pressure on the indices and India VIX is the lone smiling Index that would go home happy and satisfied.
- Today’s closing is the lowest in the last 6 months when Nifty has ended below 17000. The last 90 minutes witnessed another fall of 240 points which broke any chance of a possible expiry-related bounce. Bank Nifty broke 35000 though it ended just above the line.
- The pressure may continue for a day or two unless there is some dramatic turn of events. The steep fall in the indices in my view has placed the LIC IPO plan in a fix as clearly the market may not be ready to welcome the same with widely open arms.
- Today’s sell-off may also have been aggravated by the new SEBI circular requiring the traders/investors to have a minimum of 50% margin in the form of cash for open positions in derivatives. This is based on what I read a couple of days ago.
- After 22-12-21, today is the first day where Nifty OHLC Is below 17000. And after 31-12-21, for the first time, Bank Nifty ended below 36000 and the close for the day was way below 35500 as well.
What do you feel about this?
Here is the link to the video:
https://youtu.be/Bmrg4xb8pZ4
The post is for educational & informational purposes only.
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