Bank Nifty August futures (50,265)
Bank Nifty index seems to be struggling to get a strong follow-through rise. The index opened higher today but failed to sustain. It has come down from the intraday high of 50,292 giving back some of the gains.
Bank Nifty index is currently trading at 50,115, up 0.7 per cent. The advances/declines ratio is at 10:2. Though, this is positive, it is not reflecting as a strength in the index. So, the ratio turns around, then that would drag the Bank Nifty index lower during the day.
Bank Nifty index outlook
The Bank Nifty index (49,940) has strong resistance in the 50,300-50,400 region. An intraday rise to test this resistance again cannot be ruled out. But the index has to make a decisive break above 50,400 to become bullish for a rise to 50,800.
As long as the index stays below 50,400, the bias is negative to test 49,600 on the downside during the day.
- Also read: Markets rebound in early trade; Sensex jumps 1,046 points; Nifty surges above 24,300-level
Bank Nifty futures
The Bank Nifty Futures (50,265), up 0.7 per cent. The contract has resistance at 50,400. A break above it will be bullish to see 50,600 and 50,800. On the other hand, if the contract reverses lower from 50,400, it can fall back to 49,800 during the day.
As such the price action around 50,400 will need a close watch now.
Trade strategy
Go short if the contract fails to breach 50,400 and turns down from there. Keep the stop-loss at 50,550. Trail the stop-loss down to 50,200 as soon as the contract falls to 50,100. Move the stop-loss further down to 50,050 when the contract touches 49,950. Exit the shorts at 49,900.
Supports: 49,900, 49,800
Resistances: 50,400, 50,600