Bank Nifty futures (46,680)

Bank Nifty opened today’s session slightly lower at 46,445 versus yesterday’s close of 46,535. The index is now hovering around 46,600, up 0.1 per cent for the day.

The advance/decline ratio stands at 8/4. AU Small Finance Bank, up 1.2 per cent, is the top gainer whereas Federal Bank, down 5.8 per cent, is the top loser.

The public sector banks are relatively better today when compared with the private sector banks. Nifty PSU Bank has gained 0.25 per cent whereas Nifty Private Bank is largely flat.

Bank Nifty futures

Bank Nifty futures (February expiry) began today’s session at 46,648 versus yesterday’s close of 46,639. It is now trading around 46,680, up 0.1 per cent.

The contract rallied past the resistance at 46,700 yesterday. However, there was no follow through rally, and it remains largely sideways.

Notably, Bank Nifty futures is trading near the top of the range of 45,000-47,000. So, a prolonged consolidation could increase the probability of a fall from the current level.

In case there is a decline, the nearest support levels for the contract can be seen at 46,400 and 46,000.

On the other hand, if Bank Nifty futures breaks out of 47,000, it can see a quick rally to 47,700 and then to 48,000.

Trading strategy                          

Sell Bank Nifty futures with a stop-loss at 46,700 if it falls below the support at 46,400. Exit at 46,000.

But if the contract rallies past 47,000, one can go long with stop-loss at 46,500. When the contract rises to 47,700, tighten the stop-loss to 47,350. Book profits at 48,000.

So, we suggest traders to wait for the contract to breach either 46,400 or 47,000 before taking fresh positions.

Supports: 46,400 and 46,000

Resistances: 47,000 and 47,700