Banknifty prediction for tomorrow 29 Mar | Expiry Special

28 Mei

As we discussed, the Banknifty sideways or bearish structure market was bearish while having sideways volatility.
If we look at the chart now:
The market has broken the support level to the downside with a continuously increasing volume. If the market fails to take support at 50 EMA, it will fall rapidly to the 48631 level. RSI is also below 50 and about to cross 40, which will lead to a strong, bearish structure, and the market can correct itself to 200 EMA levels.

If we look at the OI data:
PCR = 0.80, which has fallen from 0.98. That indicates that there is good CE writing at higher levels, which can also be seen in the OI chart. 49000 is the max pain for Banknifty. Also, the next good PE writing is at 48500. there is not much CE writing on lower levels.

I am expecting a bearish market with a good volatility market in upcoming sessions because VIX is 24.2.

Reason:

1. RSI < 50 falling from the upside shows a good reduction in the bull's strength. If it crosses 40 on the downside, the market will be strong and bearish.
   
2. EMA(13) > Price > EMA(200), which indicates indecisive or rather sideways market. the market can correct itself till 200 EMA.
   
3. The market has formed a lower high that indicates the market is bearish.
   
4. PCR = 0.80 indicates mild bullish, but this has fallen from 0.98, which shows good CE writing on higher levels.
   
5. price < VWAP shows that a weak market structure can lead to a bearish market.
   

Verdict: Bearish

Plan of action:
Sell 49100 CE (Hedge it with 15/- PE premium)

Note: you can target 200 EMA.