Bank Nifty August futures (50,245)
Bank Nifty recovered some of the loss in the early trades but seems to be struggling to sustain it. The index made a high of 50,688.80 and then has come down sharply from there.
It is currently trading at 50,231, up 0.3 per cent. The advances/declines ratio is at 9:3. This is negative. If this trend sustains, then the index can fall more during the day.
Bank Nifty index outlook
Failure to sustain the initial gains indicate the inherent weakness in the market. Also, the price action suggest that strong sellers are present around 50,700. Immediate resistance is around 50,400.
The chances are looking high for the Nifty Bank index to break 50,000 and fall to 49,800-49,700 during the day.
The index has to breach 50,400 first and then get a subsequent rise above 50,700 to ease the downside pressure. Only then it can move up to 51,000 and higher. But such a rise looks less likely.
Bank Nifty futures
The Bank Nifty August (50,245) is up 0.05 per cent. The contract has come down sharply from a high of 50,767.
The intraday outlook is bearish. The contract can fall to 50,000. A break below it can drag the Bank Nifty August Futures contract down to 49,800.
Intraday resistance will be at 50,450.
Trade strategy
Traders can go short now at 50,245. Accumulate on a rise at 50,400. Keep the stop-loss at 50,550. Trail the stop-loss down to 50,200 as soon as the contract falls to 50,120. Move the stop-loss further down to 50,050 when the contract touches 49,950. Exit the short positions at 49,800.
Supports: 50,000, 49,800
Resistances: 50,450, 50,800