The Bank Nifty index is trading lower. It is down 0.3 per cent and is currently at 46,673. The advances/ declines ratio is at 3:9, which indicates broader weakness in the index.
Bank Nifty outlook
The intra-day price action over the last one week indicates the formation of a double top reversal pattern. The neckline support of this pattern is near 46,500. So, a break below 46,500 will be bearish for this week. Such a break can drag the Bank Nifty index down to 46,000, and even 45,500 this week. So, the price action around 46,500 will need close watch in the coming sessions.
Bank Nifty futures outlook
The Bank Nifty February futures (46,715) is down 0.3 per cent now. The contract has crucial support at 46,600. A break below this level can drag the contract down to 46,300 and 45,900 in the coming sessions.
On the other hand, a bounce from around 46,600 can take the contract up to 47,000-47,100 during the day.
Trade strategy
Traders can go short on a break below 46,600. Keep a stop-loss at 46,850. Trail the stop-loss down to 46,400 as soon as the contract falls to 46,250. Move the stop-loss further lower to 46,220 when the contact touches 46,180 on the downside. Exit the shorts at 46,100.
Supports: 46,600, 46,300
Resistances: 47,000, 47,100
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.