Bank Nifty opened Tuesday’s session marginally higher at 52,467 versus yesterday’s close of 52,456. The index is now hovering around 52,500, up 0.1 per cent.
The advances/ declines ratio stands at 3/9, giving the index a bearish bias. Bandhan Bank, up 0.9 per cent, is the top gainer, whereas Kotak Mahindra Bank, down 1.4 per cent, is the top loser.
The private banks are broadly outperforming their public sector peers. Nifty Private Bank is up 0.1 per cent, whereas Nifty PSU Bank is down 0.1 per cent.
Although the index has been range-bound over the past week, it is now near its 20-day moving average, which can trigger a rally.
Bank Nifty futures
Bank Nifty futures (July contract) opened today’s session at 52,650 versus yesterday’s close of 52,630. It is currently hovering around 52,600.
The contract is now trading near its 20-day moving average at 52,500. At the same time, it has a resistance at 52,800.
If the contract rises above 52,800, it can establish a fresh leg of uptrend, which can lift it to 53,300 quickly. A break-out of this can open the door for a rally to 54,000.
On the other hand, if Bank Nifty futures declines from here and falls below 52,300, it can result in a downswing to 51,500.
Trading strategy
Considering the prevailing conditions, we suggest staying out. Buy Bank Nifty futures if it breaks out of 52,800. Target and stop-loss for intraday can be 53,300 and 52,580 respectively.
Supports: 52,300 and 51,500
Resistance: 52,800 and 53,300