Saturday, February 19, 2011

A Date With 'Expiry'

To keep the 'date' with the 'Expiry' week , following are my observations that may hold good till expiry on 24-02-11. (Friday excluded)

1. Expiry Week trading is taken over by the Market dynamics pertaining to demand & supply of various types of players, the Long term players' rollover to next series, single series positional players' liquidation ,Intraday players activism etc. The Expiry is the sum total effect of all this and more.

2. Feb. series has seen both a big fall and a big rise with good volumes. It becomes all the more tricky to judge the Expiry if the Markets have trended both ways.

3. Last Week was traded in the range of 5400 - 5600.

4. Last trading day had record turnover in F&O segment and especially in Index options.

5. FII's were buyers in the last trading session for 200 cr+

6. Last Two trading sessions had a VWAP of apprx. 5520 NF with good volumes.

7. Volume profiles , the Volumes at a Price , for 5day and 10 day are identical with High Volume Nodes at apprx. 5485-5500 levels .

8. The Option Analysis shows the built up of Max. Open Interest on Put side at 5400 strike   ( 1 cr+) and that at Call side at 5600 strike (apprx.86 lacs). The Maximum Pain level ,the one which causes max. pain to majority is at 5500 levels.

9. Interestingly , The 5400-5415 range has the 5day lema,5week lema and 5month lema in it .

10. Though the last session close was below all important averages as 5dema,20dema ,5week ema etc. (making the Trend down in all Time Frames), It was a positive week with close above the last Week's high of 5542 and also it made a new high above the  previous high of the Feb ,series at 5556.

My bias is that this Week's trading upto expiry will be in the range of 5400-5600 ,may be with a whipsaw below 5400 . The expiry can be expected in the range of 5500 +/- 50 points, i.e. between 5450 and 5550 ,probably in the lower half of the range below 5525.

(One may also keep 5415 level as a SAR ,Trade short below it and long above it , booking profits quickly, trade light and nimble)

Have a nice Trading Week ahead !!


mynac said...

Very nice analysis again.Thanks.

"High Volume Nodes at apprx. 5485-5500 levels" & "keep 5415 level as a SAR '
are high light point for me.

On Friday, 1st time there was an evidence of serous rollover/addition of 19.82 lac out of total 58,18,150 March NF & The VWAP was 5547.33 & close was 5476 for the same.
There was huge writing in March 5600 CE & from percentage-wise it is 35% i.e. 4.42 lac.
Considering the budget expectation,res.above 5600 it looks very tough for Nifty to go & cross 5600 in a hurry.
If the the roll over shall be below 2 Cr.& if by chance the budget will be market friendly,then only we can expect a sharp rally beyond 5600 otherwise at present there is no sign of the same.
Considering the close & huge 5400 PE built up for this series,Nifty may trade above 5400 up to expiry but if Bulls shall try to lift Nifty beyond 5500-5600 in hurry,the next series FNO data is not helpful for the same.The sellers have shown their intentions so interesting expiry & the journey ahead.
Considering the current trend I would like to go short at higher levels only, whenever Nifty shall start to get tire there.

AAR VEE said...

Hi mynac,

Thanks for sharing ur views ,the data for the next series is particularly of help.

AAR VEE said...

One may visit the Blog of Dear Jazz-'The Profile Trader' for the different alternative EW counts that may be probable in near future.His views are concurrent with mine in this aspect.


mynac said...

From here onwards 5550 has very much importance,not for this week or expiry but for next series.Any strength if there shall be or is any,then it shall be only above 5550,so the roll over below & above 5550 will have big importance & impact in coming days.It may decide the confirmation for EW analysis.
Let us see.

AAR VEE said...

@ mynac,

Though my preferred EW count is of the sucker B wave up ,to a target near 6000 levels,(we may be 2nd wave of that B),objectively i will trade short below 5177 and long above 5600 positionally for 200-300points in the short term.

Rajib said...


What is "2nd wave of that B"? Did not get this part!

AAR VEE said...


If we take the completion of the correction since 6338 in a-b-c pattern upto 5177 ,making a wave 'A' ,then the wave 'B' will hold on the lows and can go probably to near 6000 levels.I am considering it in 5waves as of now ,the first wave being 5177 to 5600,(last trading day top).For this to be valid, 5177 should hold.

The alternate count will be a pending 5th of the 'c'in which will not cross 5690 ,break 5177 and form a new low may be apprx. 5000 levels.

Rajib said...
This comment has been removed by the author.
Rajib said...
This comment has been removed by the author.
Rajib said...

How can you consider a "B" of 5 waves? Am I missing something?

Just found an interesting thing. Have a look at weekly closing line chart of nifty ... just zoom it from the peak of nov'10 or may be from oct'10 ... I don't see any other option except the v-th pending ... that means it has to close past 5310 ... and to keep 3rd not the shortest ... it can not close beyond 5057.

AAR VEE said...


can u do an EW post for reference on ur blog ? It will be helpful to know why 'no option except 5th pending':)

I know no other indicators(except may be weekly oversold)points to the upmove now. keeping tight s/l or SAR, money can be made still even if preferred goes wrong:))

Rajib said...

aare your smiley says my statement was something utter stupid ... might be in excitement at middle of the night I wrote-deleted-wrote ... :P

Still I shall give my reasoning but don't want to dilute my P&F space ... can send the study to ur mail id EOD ... send me a blank mail to my id

AAR VEE said...

nah nah, Nothing of that sort.
Just that how strong bias we can have ,and an irony that ur weekly is saying down trend still to resume & i m following it :)).

Let 5177 give way then we sail in the same boat.

giving u a mail with my study.charts only no write urself.

AAR VEE said...

mail sent pl. check and revert with ur study


Rajib said...

did not receive your mail yet ...

this is what happens when you start following too many things ... I am still sticking to my P&F study ... not because it's something great but just because else I will pollute my though process and my plan ...

actually what happened is somebody (prabha!) shared the Frost & Prechter EW e-book in JN ... I am reading it these days ... got a bit enthu and picked up the weekly closing line chart of Nifty ...

I found that clear 1/A, 2/B done and 3/C going on ... as in current formation for 'c' i don't see anything else a 5 wave ... I came to that conclusion ...

words are 1/1000th expressive as charts ... so hope u got my jabber ... :)

AAR VEE said...

Pl. check the email id given by u above.I have resend the mail.

Now fwd me the e book too.:)

AAR VEE said...

Hi Rajib,

Also sending u the inverted h&s chart ,not in hrly,but in daily.the target is 5850 appx above 5550 ,the 61.8% target appx for B in the fibo chart.

If the ebook is heavy ,u can give me the link .

AAR VEE said...

Thanks santhosh

Piyush Sharda said...

rv if its frost and pretcher u r talking abt the link was posted on friday eod at jn. but u read all the posts and u wudnt miss it nevertheless..........

AAR VEE said...

Hi PS,
Ya talking about the same and couldn't download it ,hence had asked u to mail it also.

BTW i read only sir's comments eod.
unless some rajeev crops up :)

Piyush Sharda said...

it must be still there. i downloaded frm it. if u still find problems i will try to upload b cos the size is big to be mailed
(never uploaded anything before) ist i'll
have to figure out how.