Nifty Bank index has risen well above the key 56,000-56,100 resistance region. The index opened with a wide gap-up and is now trading at 56,580, up 0.95 per cent. The advances/declines ratio is at 11:1. This is positive.
Nifty Bank index outlook
Nifty Bank index has support at 56,400 which can limit the downside during the day. Although an intraday dip cannot be ruled out, a fall below 56,400 is less likely.
Intermediate resistance is around 56,750. A break above it can the Nifty Bank index up to 56,900.
A fall below 56,400 is needed to turn the near-term view negative and see 56,000 on the downside.
Nifty Bank Futures
Nifty Bank June Futures (56,624) is up 0.94 per cent. The contract has support at the 56,400-56,370 region. Resistance is around 56,750. We expect the contract to sustain above 56,350 and breach 56,750 eventually. Such a break can take it up to 57,000-57,200.
Trade Strategy
Go long on dips at 56,570 and 56,480. Keep the stop-loss at 56,280. Trail the stop-loss up to 56,620 as soon as the contract goes up to 56,700. Move the stop-loss further up to 56,720 and 56,840 when the contract touches 56,800 and 56,900 respectively. Exit the long positions at 56,980.
Please note that this trade, if executed, can be held for this week.
Supports: 56,370, 56,000
Resistances: 56,750, 57,000