Bank Nifty began today’s session with a gap-up at 47,899 versus yesterday’s close of 47,782. The index rallied after opening and is now hovering around 48,340, up 1.2 per cent. It has surpassed an important level and, so, the probability of further rally is high.

All 12 stocks in the Bank Nifty index have advanced today, a bullish sign. Bank of Baroda and Axis Bank, up 2.7 per cent and 2.4 per cent, respectively, are the top gainers.

The public sector banks seem to be powering the rally and have outperformed their private peers. Nifty PSU Bank is up 2.2 per cent whereas Nifty Private Bank is up 1 per cent.

Bank Nifty futures

Bank Nifty futures (May contract) opened today’s session higher at 48,055 as against yesterday’s close of 47,974. It is currently trading at 48,480, up 1 per cent.

Since the contract has rallied past the resistance at 48,400, the likelihood of further appreciation is high. As per the chart, Bank Nifty futures can rise to 49,000, the nearest notable resistance. Subsequent resistance is at 49,250.

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On the other hand, if the contract makes a U-turn and falls, it can find support at 48,400. Below this, there is support at 48,150. That said, given the current positive momentum, the contract is less likely to fall below 48,150.

Trading strategy

Buy Bank Nifty futures now at 48,480. Accumulate if the contract softens to 48,250. Place initial stop-loss at 48,100. When the contract touches 48,800, tighten the stop-loss to 48,400. Book profits at 49,000.

Supports: 48,400 and 48,150

Resistance: 49,000 and 49,250

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