A Day of Flat Openings, Bullish Moves, and Quick Exits

Today began with Banknifty opening at +40.25 points and Nifty at +6.40 points, both classified as essentially flat starts. Despite the mild gap-up, my attention quickly turned to Nifty, where I anticipated a possible breakout above the previous day’s high.

Shortly after the opening, I noticed Nifty successfully pushing beyond its previous day’s high. Acting on that signal, I sold the 23,150 PE strike at ₹114.05, placing a 20-point Stop Loss. My target aimed for a 1:2 risk-to-reward (R:R) ratio, and when the price reached around ₹72, I decided to exit.

Although this yielded a satisfactory return, had I held the position longer, it might have climbed to a 1:6 R:R. It’s a reminder that sometimes opportunities continue even after our planned exit.

Meanwhile, Tata Motors opened –6% lower. By the time I initiated my Nifty trade, the stock had dipped further to –8%, indicating persistent selling pressure there.

In contrast to the bullish spark in Nifty, Banknifty remained locked in a sideways range, especially around its first 5-minute candle. Despite Nifty’s upward momentum, Banknifty did not show a decisive follow-through at the outset. It formed an inside candle on the 15-minute chart, often signifying indecision.

Notably, while Nifty was rising, many of its top 10 weightage stocks didn’t contribute strongly. Only Bharti Airtel and Larsen & Toubro (L&T) lent modest support, with a major push coming from Bajaj Finance. My view was that if Banknifty joined this rally, it could enhance Nifty’s upward movement. However, it stayed range-bound for some time.

When I placed my Nifty PE sell order, I noticed Put premiums were higher than Call premiums, suggesting room for an upward move in the underlying spot price. Later in the session, Reliance also joined the bullish list, adding further momentum to Nifty’s upward trajectory. By 10:02 AM, Banknifty finally showed some alignment, giving a breakout above its day high and supporting Nifty’s climb.

I considered jumping back into trades, but decided to wait for a pullback, followed by a clear price action confirmation. Entering mid-rally without a clear setup can be risky, especially if the market retraces quickly.

One moment stood out as “strange”: Nifty’s spot chart printed strong bullish candles with very little pullback. However, the option price candle for a short position did not continue declining as expected. Instead, it formed a bullish candle of its own. Being primarily involved in option selling, I noticed the spot and option charts weren’t perfectly synced, which sometimes happens if implied volatility shifts or if there’s a temporary mismatch in order flow.

By 10:44 AM, key Nifty stocks—Reliance, Bharti Airtel, HDFC Bank, and L&T—were all pushing higher. Recognizing the day high breakout in Banknifty, I decided to sell 49,200 PE at ₹110.80 and later exited at ₹96.60 when the spot chart began to dip.