Nifty: Daily Price Analysis

[columbus]

Columbus, you are right. After NF, BNF is second most popular indices.. But in my view, it is more senstive to the move of 2 big players..

Table below gives the rough weightage of them as per today's trading..

SBIN		29%
ICICIBANK	26%
HDFCBANK	17%
AXISBANK	14%
KOTAKBANK	3%
PNB		3%
BANKBARODA	2%
CANBK		1%
IDBI		1%
ORIENTBANK	1%
UNIONBANK	1%
BANKINDIA	1%

Due to skewed composition, it is comparatively very easy to manipulate the move. It is not that easy for Nifty which is broader then BNF.
Generally it gives wider swing then NF. So if you trading needs to play more volatile instrument, then this is the place to be.

Also keep in mind the margin requirement.. which will be slightly higher for BNF (i might be wrong here).

I prefer to trade NF cause there are more professionals who track it and use it as benchmark.

Happy Trading.

Dear Aw10,

Funny enough the major constituents of BNF; SBI&ICICI have good weightages in Nifty also .(4.63 and 2.89 respectively).The volatility in
BNF is very high.

 

[aditya14]

Just wanted to show the picture that I see and probably some people are missing to see.

Here is the content from NSE Site.

Index 		Current 	Pts Change 	% Change 
 
S&P NIFTY 	5119.35 	40.75 		0.80 % 
CNX NIFTY JNR	10914.00 	-16.15 		[B]0.15 % [/B]
CNX IT 		5739.25 	4.15 		0.07 % 
BANK NIFTY 	9451.75 	105.30 		1.13 % 
CNX 100 	5091.10 	32.70 		0.65 % 
S&P CNX DEFTY 	3788.20 	41.55 		1.11 % 
S&P CNX 500 	4247.25 	18.30 		[B]0.43 % [/B]
CNX MIDCAP 	7892.30 	11.60 		[B]0.15 % [/B]
NIFTY MIDCAP 50 2682.20 	-2.40 		[B]0.09 %[/B]

Look at the broad market indices - Nifty Junior, CNX 100, CNX 500, Midcap.. none of them have gained more then nifty.
You might say - So what ?

Here is the data from yesterday. And fact still remain the same that all broader indices are not moving as much as nifty.

Index			Pts 	%
			Change	change
S&P CNX Nifty		78.3	1.57%
CNX IT			64.7	1.14%
CNX Nifty Junior	141.15	1.31%
S&P CNX Defty		64.75	1.76%
BANK Nifty		108.25	1.17%
CNX Midcap 		97.55	1.25%
S&P CNX 500		56.95	1.37%
CNX 100		        75.9	1.52%
Nifty Midcap 50		42.5	1.61%

So what is my interpretation - When market is strong, everybody will participate in that and these secondary indices will show larger move then big elephants in nifty. but that is not the case.
Moreover volume on both the days is not something great to talk about.

So what do you make out of the current up-move ? I leave it to you to decide - just visualise the horse carriage of 100 horses going uphilll, where majority of horses are moving slower then the others. What will happen to carriage ? How much /how long stronger horse can pull the weaker ones ? Or what if weaker one decide to go downhill ?

Anything can happen tomorrow.. and things might ..but this is my reading as of EOD today. My guess is as good as yours on what will happens on Monday.

Happy Trading

That is always the case when Largecaps move first and then the laggards are smallcap stocks from other sectors.

We are headed higher next week as weekly close is positive and shortcovering is looming large.IIP numbers were better than expected too.Maybe we consolidate few days then move up but fears have trapped some bears again.

 

[aditya14]

This Post LOOKS LONG SORRY FOR THAT BUT THE KNOWLEDGE THAT IT WILL GIVE IS REALLY AMAZING...will let u know what is really hiding in Bushes...

Financials - A Ticking Time-Bomb

Not to beat a dead horse, but the European debt crisis has been an ugly reminder that putting a lid on problems doesn't mean they go away. In fact, the lid may just hide the nasty stew brewing underneath.

This post was far too long so i just read the first paragraph great premise for the story though

 

[scplindia]

Great informative posts in the last 24 hours.

Just to add a point or two to this.

1. The general trend in Stock market is, Large caps lead and a couple of days later, the small caps follow after ensuring stability in large caps price action. As per the horse story, the strong horse lead the climb, once the climb is over, the weaker once take over, if the climb holds.

Hence, one can expect trend reversal, only if the large caps which led the rise, hold their prices at the present levels, which is going to be a big question considering all the posts we have seen in this thread in the last 24 hours.

2. The last few days rally, as in the media report has been due to China data. As mentioned in the posts, even the American financial have been misleading the world with cooked up data.

How can we trust the data coming out of China.
Untill last week, the American have been pushing China to devalue its currency, the demand for base metals have been falling steadily in China, the real estate is facing a major crisis in China, the trade unions have been threatening and have been on strike in China, with all this going on, how can exports go up by 50 percent ?

 

[SwingKing]

Re: Bank Nifty and Nifty Comparative Volatility

AW10,

Just take 2 indices ,namely, Nifty & Banknifty.The lot sizes are 50 & 25
respectively.The ratio of points of Bank nifty/nifty should be ideally 2 keeping
in the view of lot sizes.However it was 2.58 (105.3/40.75)in favour
of Bank nifty.I think it is profitable to trade in Bank Nifty.

The discussion between AW10 and Columbus prompted me to study the historical volatility relation between Nifty and Bankex. On the face of it, it does appear that Bankex has more volatility than Nifty. Hence, what I did was I calculated the Comparative volatility for both where we actually take out the Rupee value of a %move and adjust it according to volatility. The result is given below. Some might argue that volatility in BankNifty is high due to the range at which it trades. Well, this is not the case. Till about 2003, they were trading mostly around the same level. Even then, the Rupee value of a %move was greater than Nifty. Since BankNifty has started to trade at different level now, this does contribute towards higher volatility, but the ratio remains the same.

BankNifty, ever since its inception has been more volatile than Nifty. This could be because of its over dependence on fewer counters. For those who need volatility to trade, Bank Nifty is the place to be. Sadly though, its options often are not that active.

Tc

 

[columbus]

Re: Bank Nifty and Nifty Comparative Volatility

BankNifty, ever since its inception has been more volatile than Nifty. This could be because of its over dependence on fewer counters. For those who need volatility to trade, Bank Nifty is the place to be. Sadly though, its options often are not that active.

Tc

Hi Raunak,

Good post. For a Scalper who likes a +/- 20 point move ,it is wise to trade in
Bankex because 5point move in either side of Bankex is quite common.

 

[highonlife]

AW10,

Just take 2 indices ,namely, Nifty & Banknifty.The lot sizes are 50 & 25
respectively.The ratio of points of Bank nifty/nifty should be ideally 2 keeping
in the view of lot sizes.However it was 2.58 (105.3/40.75)in favour
of Bank nifty.I think it is profitable to trade in Bank Nifty.

I dont understand what does the points change in an index have to do with the lot sizes?

The lot sizes are for futures contracts, and the points change are an overview of the daily change in the constituent stocks.
The stocks are traded on many exchanges, but the lot sizes for a futures contract is decided upon by a single exchange. If the BSE tomorrow decides to keep 25 as a common lot size for both, but the NSE decides to keep 50 and 25...why should it at all have an impact on the prices of the individual stocks?

 

[Apurv7164]

Hey guys...

I m trying to get back on track in market after nice significant break so please guide me and correct me if m goin wrong anywhere rather than LOL....

Ok... here are my 2 cents...

I could find somebody suggested level of around 4400 and other person vouched for it but with the view of reaching 5500 or so first and then going down... somehow I m also getting similar feeling of going little up and then down...

Reasons:
1> I m feeling NF to forming small 123 pattern... very basic and old styled pattern but it always worked well for me so I first try to spot it... I can sense something like 123 on NF chart...

2> If we notice formation of last 2 trading sessions, 11th june bar is entirely above 10th June... I am not sure how you all signify it.... m taking it positively..

3> There are skepticism already spread in mkt so I guess they wud try to get some weak hands on board and then wud go down....

~ Apurv

 

[SwingKing]

Hey guys...

I m trying to get back on track in market after nice significant break so please guide me and correct me if m goin wrong anywhere rather than LOL....

Apurv,

Follow your heart and follow your analysis.

We are just exploring one of the possibilities. It may very well be that we are wrong. Lets not try and find 'certainty' in 'uncertainty'.

Good luck.

Tc

 

[Probafix]

Thanks for great info.