Bank Nifty opened today’s session with a gap-up at 50,736 versus yesterday’s close of 50,479. The index moved up further after opening and is now at 50,850, up 0.8 per cent.
The advance/decline ratio now stands at 9/3. HDFC Bank, up 1.6 per cent, is the top gainer whereas AU Small Finance Bank, down 1.1 per cent, is the top loser.
Nifty Private Bank has gone up by 0.9 per cent whereas Nifty PSU Bank is up 0.25 per cent. Therefore, private banks are largely outperforming the public sector peers.
Bank Nifty futures
Bank Nifty futures (October contract) opened today’s session higher at 51,132 versus yesterday’s close of 51,016. It is now trading at 51,180, up nearly 0.3 per cent.
Although the contract is in the green at the end of the first hour of today’s trade, the broader bear trend remains. The price action indicates limited upside potential.
From the current level of 51,180, the nearest resistance is at 51,500. A rally beyond 51,500 today is unlikely.
We expect Bank Nifty futures to drop from the current level of 51,180 or after moving up to 51,500. On the downside, the notable support is at 50,500.
Trading strategy
Short Bank Nifty futures now at 51,180 and on a rally to 51,400. Place stop-loss at 51,700. When the price slips to 50,800, revise the stop-loss to 51,100. Book profits at 50,500.
Supports: 51,000 and 50,500
Resistance: 51,500 and 51,800