NIFTY Market Analysis: Key Insights for September 30, 2020
As the market experiences significant movements, it’s essential to analyze the trends and prepare for the next day's trading. This article delves into the NIFTY index for September 30, 2020, with a focus on market dynamics, technical indicators, and key support and resistance levels.
Market Timing and Routine
Traders often set specific times to enter the market to capitalize on trends. N R Sushi shares his routine, indicating a consistent daily trading approach between 9:40 am to 3:10 pm. He checks his market barometer at the beginning to determine whether the day is bullish, bearish, or flat, and adjusts his trades accordingly.
On a bullish day, Sushi advises trading long before 12:20 pm and short between 12:00 pm and 12:40 pm. He also mentions that on bearish days, two short trades are likely between 10:50 am and 1:00 pm, with an additional short trade after 2:40 pm.
Today's Market Overview
Today, the NIFTY index closed in green territory, with the support of the BANK NIFTY index. This positive trend extended into the second half of the day. The American stock market also opened in green, while the SGX NIFTY index touched the 12,000 level, indicating strong bullish sentiment.
From a technical analysis standpoint, the one-minute chart suggests a movement that aligns with the overall bullish trend. However, Sushi advises using thorough analysis before engaging in trades, acknowledging the importance of carefully evaluating market signals.
Technical Indicators and Chart Analysis
The NIFTY hourly chart shows a hammer candle on the daily chart, indicating strength at lower levels. The key level of 12,000 is crucial and will play an important role tomorrow. If this level is breached and sustained, a 100-point upward movement could be anticipated.
The NIFTY option chain data reveals that at-the-money strike at 12,000 sees a higher call writing rate compared to put writing, indicating some bearish pressure. However, the highest open interest on the put side is at 11,500, while the nearest support on the call side is at 11,900.
Key Support and Resistance Levels
N R Sushi highlights that 12,000 will serve as a strong resistance level, while 11,800 will act as support on the downside. The fact that the SGX NIFTY has already crossed 12,000 suggests that a gap up opening is possible, leading to a potential 100-point rally.
Conversely, if there is a gap down or even a small increase, selling pressure is expected, particularly a sell-on-rise scenario. The author warns about a volatile expiry period due to the critical position of the NIFTY index.
Conclusion
Understanding market patterns and technical indicators is crucial for traders. By closely monitoring support and resistance levels, as well as staying active in market sentiment analysis, traders can make informed decisions. This analysis for September 30, 2020, offers valuable insights into how to navigate the NIFTY market effectively.
N R Sushi's routine and insights not only provide a structured approach to trading but also highlight the importance of thorough analysis and preparedness for market movements.