Nifty Futures Pre Market Analysis - 7/7/2011

Nifty is trading in a Bracket, it is the balancing time after an up move. The buying tail on Wednesday is a key reference point. Getting short in the hole caused the afternoon rally. A breakout/failure from VA offers opportunity. If opens out of balance, then the bracket extremes are key reference points. Strategy is to buy near bracket low and sell around bracket high. If opens above VAH and holds VA, then it may rise up to bracket high.

Nifty Futures Pre Market Analysis for 5/7/2011

Well, the nifty futures remains one time faming up. However an excess formation may be underway. Inside day and Balanced Day. Volume is lower. A bracket formation is underway.

When u see a balanced profile, usually the asymmetric trade opportunity is breakout from balance. There is good probability that we had a short term excess on 1/7, but it is not a strong one.

1. Single prints, coincides more or less with the single prints from previous day. Upward breakout should be       traded with extreme caution. Observe volume for clues of breakout failure.
2. Poor Low from previous day not repaired. We carry forward this information.

There is an anomaly on the shorter time frame profile chart. This area coincides with the single prints discussed in 1. So this level may be a strong resistance point and day high may be formed around this level.

If market opens higher and volume is not coming, then nifty will be attracted back to the prominent POC 5665. Same is true for a lower opening also.

Trade Plan 4-7-2011

The nifty continue to onetime frame up. However volume was lower on Friday and the gap up open was rejected back into Friday's range immediately. Nifty seems as if it needs to be balanced.

1 & 2 - Double Distribution. The lower distribution is overlapping with the Thursdays VA. This is a balance zone and breakout from this balance is next trading opportunity.

3. Single Prints and intra-day pull back high. This is a key reference point for Monday.

4. Selling tail, another key reference point for Monday

There is a poor low on Friday. A repair and pullback into Friday's range should be kept in mind while taking a break down trade.  Also we have a previous excess high at 5608 which is significant now.

Trade Plan 9 - 6 - 2011

Neutral Day with no directional conviction. The bracket extremes are the important reference points. Opportunities exist when NIFTY breakout of last session's Range. Look for acceptance or rejection at High/Low. If market trades out of balance, then the market extremes becomes important reference points. Open today is important, if opens out of balance, then good opportunities may emerge

1. Open within VA and tests High. Watch for acceptance/Rejection.
2. Open within VA and test of Low. Watch for acceptance/Rejection.

Trade Plan 08-06-2011

Good trade facilitation on the upside, volume was somewhat ok. Profile structure shows an initiative buying tail. The anomaly at 5534 may be revisited. On the upside there is VPOC at 5590. On 6/3, NIFTY formed an excess at 5608.5 which is an important reference point on the upside.

 NIFTY traded back through the single prints separating 6/3 double distribution. This opens the possibility of testing the excess created on that day.

1. Opens within VA and revisits the anomaly at 5534 and bounces from there.
2. Opens within VA and comes down to the tail and get rejected.
3. Opens Above VA and fails to auction above yesterdays high
4. Rejection from VPOC
5. Failure to auction above the excess

These are some of the scenario that may develop today. 

Trade Plan 2/5/2011

Well, this update is after a few months. There was good trade facilitation towards the down side on Friday with initiative selling RE. However the market spend more time around Thursdays VA and then RE came. This indicates some early acceptance at higher levels, before the RE. This may be a warning that the down move is ending.

1. Index completes the double distribution from Friday and continue to trade downward. If this happens, observe the profile for completion of DD and when u feel it is complete, look for down ward break. Another scenario is a failure to break above lower distributions VAH and swift down move through VA.

2. Index testing the previous swing low. If it fail to auction below the swing low, it may rise to fridays POC 5794 or beyond.


3. Index rise to the POC, slows down and trades lower.

Trade Plan 10-2-2011

VA is overlapping down. Nifty pulled back into value forming a tail in L period. This tail is an important reference point today.

Today's profile split at letter K. The P shape and failure to take out the C period high implies short covering. We are interested in the down push came in K period. In M period it pulled back. Will it came back into the balance area and get acceptance. Or further development of the last section of the profile to a complete distribution. Or break the low and find acceptance.

Two Brackets (Balance area) are marked in the candle chart. These brackets are important reference points on the higher side.
1. Rejection from VA Low, may develop as open test drive/open rejection reverse.
2. Rejection from VA high.
3. Rejection from second VA high.
4. Break down through single print. May develop as open drive.
5. Rejection from single print/Low.

Trade Plan 8-2-2011

Another bracketing phase is going on. Yesterday's profile was in good balance.  Value is accepted near the bracket low. Will the bracket hold or nifty break down from the bracket. Well, I don't know. Assuming the bracket holds, there exists good asymmetric buying opportunity around yesterday's VA. Also there is another asymmetric opportunity at VH for a short.

The region marked by blue lines is a good location for responsive buying and the yellow region is for responsive selling. The red lines around a green line represents a balance area where green line is the POC.

Trade Plan 4-2-2011

Well, the vertical move came, at open the failure to auction below yesterday's low brought in buyers. Swift move through VA shows the commitment of buyers. Single prints in B and C periods are not revisited. However we are not in an up trend. It may be another bigger bracket that is forming.

Looking for buy opportunities today. But beware of failure to auction higher may bring Nifty back into the bracket. The green line surrounded by two red lines represent a value zone. and the blue zone is a resistance zone.

Trade Plan 03-02-2010

VA formed higher and overlapping. Bracketing action is evident now. Previous days minus development area is fully developed.

See the last 3 profiles merged. Time for next imbalance (vertical move)

Trade Plan 02-02-2011

The VA overlapped in the last session. It may be the stopping phase and beginning of bracketing. Responsive selling above previous VA  and initiative range extension to the lower side indicates presence of other time frame sellers.

In the next picture, last two profiles are merged. See the balance forming.  If nifty trades back into Balance area today, expect a bracketing phase. However acceptance below VA may lead to another vertical down move.

 Some trade Plans

Trade Plan 28-1-2011

Index broke below the bracket, but todays open will confirm price acceptance below bracket. If accepted, expect the next vertical development.

Rejection from the area marked by the red arrow is todays best opportunity, if it materializes. The levels need to be adjusted as today is the roll-over day.

What Happened Today

Well, the rejection happened in the first bar, see the red down arrow, it completed the double distribution from previous day and went down.

Nifty Trade Plan 27-1-2011

Nifty attempted to trade above the multi day bracket, but failed and came back into the bracket. Jan 25 th's double distribution may get completed today.  Seems time has reached for the next phase.

The plan was to trade the open assuming a bracketing market. Which scenario will unfold at open ? You can get clues from the open. All these scenarios require immediate rejection from reference point. Open auction to complete the double distribution is marked with red curve. In this case fade the extremes where the distribution is expected to develop. Today's volatility linked SL is 11 points. The green line is POC and the red lines around the green line is VA.

Trade Plan - 25 - 01 -2011

Well, I am back after about a month's break. Hopes to continue positing regularly now.

So we have a nice down move and the vertical move has stopped and turned into bracketing phase. Now we expect the next step in bell curve formation, ie shifting of POC towards the center. Is it gonna happen or market will skip this step?. Well I don't know, but these are the scenarios to unfold now. And we trade them as each phase unfolds.

Value area is rising, but we may be in the bracketing phase. Jan 24 th profile shows strong initiative activity, but there is a small selling tail also. Profile is somewhat balanced.

Trade plan for different scenarios are marked in chart. Stop loss for todays entries is 8 points from reference points.