The Bank Nifty index has been declining since Monday, and is down 0.38 per cent today at 47,685. The advance-decline ratio is 3:9. It indicates broader weakness in the index.
Outlook
A strong rise above 47,700 is needed to ease the downside pressure and give the index a breather for a climb back to 48,000 and higher. Else the index may drop down to 47,600-47,500 in the coming sessions. We will have to wait and watch the price action for some time.
Bank Nifty Futures
The Bank Nifty December Futures (47,864) is down 0.15 per cent. Resistance for the day will be in the 47,950-48,000 region. A strong rise past 48,000 is needed to ease the downside pressure and take the contract up to 48,400 again.
But as long as the contract trades below 48,000, it can remain under pressure, increasing the likelihood of dipping to 47,650 in the coming sessions.
Trade strategy
Yesterday we had suggested a positional long at 47,930 and 47,890. Traders can exit the longs and book loss at current levels as the contract has declined below the support at 47,880. For now, stay out of the market.
Supports: 47,650, 47,500
Resistances: 48,000, 48,400