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Bank Nifty opened today’s session with a gap-down at 49,075 versus last week’s close of 49,507. It is currently hovering around 49,180, down 0.7 per cent.
The advances/ declines ratio is currently at 3/9, showing a bearish bias. IDFC First Bank is the top gainer, advancing 0.7 per cent, whereas Canara Bank, down 2.1 per cent, is the top loser.
Nifty PSU Bank has lost 1.2 per cent so far today and Nifty Private Bank is down 0.6 per cent. Therefore, broadly, the public sector banks are facing higher selling pressure than their private peers.
Bank Nifty futures
Bank Nifty futures (February contract) opened today’s session slightly lower at 49,295 against last week’s close of 49,769. It is now trading at 49,470, down 0.6 per cent.
The chart shows that Bank Nifty futures has a support at 49,200. So, despite the bearish bias, only a breach of 49,200 can lead to a further fall. A break of 49,200 can drag it lower to 48,800, or even to 48,500.
On the other hand, if the contract rallies on the back of support at 49,200, it can face barriers at 49,800 and 50,000. Resistance above 50,000 is at 50,200.
Trading strategy
Stay out and initiate shorts on Bank Nifty futures if it breaks below 49,200. Target and stop-loss can be 48,500 and 49,500, respectively.
Supports: 48,800 and 48,500
Resistance: 50,000 and 50,200
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