Bank Nifty began today’s session higher at 52,653 versus yesterday’s close of 52,606. But, it declined after opening and is currently hovering around 52,420, down 0.3 per cent.
The advance/decline ratio gives a bearish undertone for the index as it stands at 3/9. Bandhan Bank, up 1.8 per cent, is the top performer whereas HDFC Bank, down 0.9 per cent, is the top loser.
Nifty Private Bank is down 0.25 per cent whereas Nifty PSU Bank is down nearly 0.4 per cent. So, broadly, the private sector banks are facing lower selling pressure so far today.
Bank Nifty futures
Bank Nifty futures (June contract) opened today’s session flat at 52,627. It is now down to 52,450, losing 0.3 per cent.
Despite a drop in the first hour of today’s trade, the trend is positive as the contract saw a fresh breakout yesterday. This indicates more upside from here.
However, there is a chance for Bank Nifty futures to see some more decline before resuming the rally. It can possibly moderate to 52,000 and then witness another leg of rally, which can take the contract to 53,000.
On the other hand, if Bank Nifty futures slip below 52,000, it might extend the decline to 51,400. A fall below this level is unlikely.
Trading strategy
Buy Bank Nifty futures now at 52,450. Add longs if the price moderates to 52,100. Place stop-loss at 51,900.
When the contract rises to 52,800, revise the stop-loss to 52,500. Book profits at 53,000.
Supports: 52,000 and 51,850
Resistance: 53,000 and 53,500