164. Pre Market Analysis - Aug 20 , 2021
Last Friday markets closed in red due to under performance in Banking , IT and other stocks.
On Friday due to HDFC Bank news markets opened with huge gap -up but it failed to hold at higher level due to other stocks fall , however Nifty fell almost 170 points from days high , Sensex fell more than 300 points and Bank Nifty fell 800 points from days high.
In the first hour markets covered the morning gap but in the second half markets fell drastically and closed at days low which is an clear indication for us that bears are still carrying their positions.
FIIs and DIIs were both on selling side on Friday where as FIIs sold 595.32 crores and DIIs sold 729.49 crores in cash market.
There are some reasons for our fall and mainly U.S FED talks on bonds and Crude price crash and dollar index rise and Taliban kicked complete Afghanistan leaders and with all these things markets are reacting in big way and
Yesterday our markets holiday but all global markets are traded in deep red and SGX Nifty 3days back high was 16700 and now low is 16,260 but recovered 100 points as of now and
Coming to Global markets :- Last night DOW Jones closed with 66 points negative but last 2days it fell 600 points and recovered just 170 points and U.K also closed in red.
Currently Dow Jones , Nasdaq and U.K futures are trading in red.
SGX Nifty opened with a gap up of 55 points but now it is trading with just 7 points as of now , means showing bears indication.
Coming to India :- With one holiday we missed our markets to trade in red and now it will be the blood bath and expecting our markets to open more than 1% gap-down today due to global clues.
Dollar index touched Nov 2020 high and for sure it will impact our markets and crude price is trading at 66.70 $ so its clear sign for bears
If markets open with huge -down then wait for correction and today it will be sell on rise markets so any rise will be sell off today but markets may correct atleast once before fall once more so beware at lower levels and check RSI too if it is below 25 then wait for it come near 40 then sell at every high and track Dow Jones futures , any fall in Dow Jones may drag our markets more.
Remember one thing , no one expected global markets severe fall and most of the people still carrying their positions on bull side so todays gap-down may disturb them and expect some position adjustments of those guys and that will make our markets to move in consolidation or correction for sometime so that correction may touch all PE buyers so be cautious at lower levels so don't chase it until and unless you see perfect entry .
Nifty 16293 level is an strong support and once it taken out then expect free fall up to 16,160 levels and resistance at 16,350 if taken out.
Bank Nifty had a resistance at 35715 and support at 34,900 if it breaks then next will be 34,677 and 34,438.
Today is an Friday so don't try to carry your positions for Monday on these kind of situations and also try to avoid trading in the second half today.
Overall view is sell on rise market but before next fall expect one round of correction or range bound and then again it may fall .
All The Best , Trade With Discipline.
Wishing You A Profitable Day.
BONFIRETRADER