FIIs Reinforce Bearish Bias in Bank Nifty Futures – May 13, 2024
On May 13, Foreign Institutional Investors (FIIs) maintained a bearish stance in the Bank Nifty Index Futures market by shorting 6,982 contracts worth ₹1,156 crore. Despite the aggressive shorting, the session saw a net open interest (OI) decrease of 2,280 contracts, indicating that the activity was likely a combination of fresh shorts and profit booking or position closure.
FII Activity Breakdown:
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✔ Contracts Shorted: 6,982
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✔ Value: ₹1,156 crore
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Net OI Change: –2,280 contracts
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Interpretation:
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FIIs are still holding a defensive view on Bank Nifty.
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The reduction in OI suggests that while new shorts were added, some existing positions were also squared off, possibly after Monday’s sharp recovery.
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Bank Nifty posted a remarkable 3.3% rally, marking its strongest single-day gain in four years. This explosive move was driven by a confluence of Gann and Astro cycles as discussed in below video, as highlighted in our prior analysis. The sharp decline in India VIX also contributed, leading to significant erosion in OTM option premiums — a classic setup for trending markets.
Technical & Sentiment Snapshot:
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Index Performance: +3.3%
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VIX Impact: Cooling volatility crushed option premiums, particularly in far OTM strikes
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Astro-Gann Alignment: Confirmed trend acceleration phase
Key Level to Watch:
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Crucial Support: 55,000
→ As long as Bank Nifty sustains above this level, the structure remains strongly bullish.
→ Holding 55,000 opens up potential for a fresh all-time high by May 20.
Bank Nifty witnessed a mild decline today after Monday’s powerful rally. The index retraced approximately 25% of the previous session’s gains, indicating a running correction — a healthy pause within an ongoing uptrend.
Price action has settled right around the psychological level of 55,000, while critically respecting the Gann support level of 54,872.
Key Technical Insight:
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Gann Support Level: 54,872
→ Holding above this zone keeps the bullish structure intact. -
Correction Type: Running correction
→ Typically followed by continuation in the prevailing trend (in this case, up).
Macro Boost – Inflation Data:
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India’s Retail Inflation Drops to 3.16% (6-Year Low)
→ Eases pressure on the RBI, raising expectations of liquidity stability and maintaining a favorable backdrop for banks.
→ Sentimentally positive for Bank Nifty and interest-rate sensitive sectors.
Outlook & Strategy:
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✅ Bullish Bias Maintains:
As long as price sustains above 54,872, the uptrend remains active with potential to retest or break the all-time high. -
Immediate Target: All-time high zone above 56,098
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⚠️ Invalidation Level: Breakdown below 54,872 could trigger a deeper retracement toward 54,300–54,000.
Bank Nifty Trade Plan for Positional Trade ,Bulls will get active above 55417 for a move towards 55889/56363. Bears will get active below 54948 for a move towards 54480/54014.
Traders may watch out for potential intraday reversals at 09:17,11:35,12:35,01:20,02:41 How to Find and Trade Intraday Reversal Times
Bank Nifty May Futures Open Interest Volume stood at 17.7 lakh, with liquidation of 1.4 lakh contracts. Additionally, the Increase in Cost of Carry implies that there was a closure of LONG positions today.
Bank Nifty Advance Decline Ratio at 05:07 and Bank Nifty Rollover Cost is @55480 closed below it.
Bank Nifty Gann Monthly Trade level :54467 closed above it.
Bank Nifty closed ABOVE its 20 SMA @54504,Trend is Buy on Dips till above 54300
Traders who follow the musical octave trading path may find valuable insights in predicting Bank Nifty’s movements. According to this path, Bank Nifty may follow a path of 53548-55141-56734. This means that traders can take a position and potentially ride the move as Bank Nifty moves through these levels. Of course, it’s important to keep in mind that trading is inherently risky and market movements can be unpredictable.
According to the Bank Nifty options chain, the call side has the highest open interest (OI) at the 55000 strike, followed by the 55500 strike. On the put side, the 54500 strike has the highest OI, followed by the 54000 strike.This indicates that market participants anticipate Bank Nifty to stay within the 54500-55500 range.
The Bank Nifty options chain shows that the maximum pain point is at 54900 and the put-call ratio (PCR) is at 0.81 Typically, when the PCR open interest ranges between 0.90 and 1.05, the market tends to remain range-bound. PCR is on extreme end suggesting we can see sharp reversal .
Those who succeed big at anything all have the same attitude: You keep going until it happens or you die trying. Quitting is not an option.
For Positional Traders, The Bank Nifty Futures’ Trend Change Level is At 55021. Going Long Or Short Above Or Below This Level Can Help Them Stay On The Same Side As Institutions, With A Higher Risk-reward Ratio. Intraday Traders Can Keep An Eye On 55237, Which Acts As An Intraday Trend Change Level.
BANK Nifty Intraday Trading Levels
Buy Above 55025 Tgt 55196, 55330 and 55555 (BANK Nifty Spot Levels)
Sell Below 54888 Tgt 54729, 54555 and 54323 (BANK Nifty Spot Levels)
Wishing you good health and trading success as always.As always, prioritize your health and trade with caution.
As always, it’s essential to closely monitor market movements and make informed decisions based on a well-thought-out trading plan and risk management strategy. Market conditions can change rapidly, and it’s crucial to be adaptable and cautious in your approach.
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