Bank Nifty index opened with a gap-up today at 45,935 versus yesterday’s close of 45,845. After marking a high of 45,995.85, the index is now hovering around 45,920. Thus, it is up 0.15 per cent for the day.
The advance/decline ratio of Bank Nifty stands at 10/2, indicating strong positive bias. PNB, up by 2 per cent, is the biggest gainer whereas HDFC Bank, down by 0.2 per cent, is the top loser.
Within the banking sectors, public sector banks broadly outperform the private banks – the Nifty PSU Bank index is up 0.8 per cent but Nifty Private Bank index has gained 0.2 per cent.
Bank Nifty futures
The July expiry futures of Bank Nifty opened the day higher at 45,990 versus yesterday’s close of 45,924. It is currently trading around 45,960.
At the current level, the contract is facing a falling trendline resistance. Immediately above this level is another resistance at 46,075. Therefore, Bank Nifty futures should break out of the resistance at 46,075 in order to establish a rally. In such a case, the contract can rise to 46,300 or even to 46,500.
On the other hand, if the price falls from here, the contract will find support at 45,750. A breach of this level can turn the trend bearish and lead to a potential fall to 45,500, a support, today. Subsequent support is at 45,250.
Nevertheless, the overall bias is bullish.
Trading strategy
Even though the likelihood of a rally is high, we suggest traders to wait for a confirmation before pulling the trigger.
Buy Bank Nifty futures if it breaks out of 46,075. Intraday target and stop-loss can be at 46,500 and 45,850.
Supports: 45,750 and 45,500
Resistance: 46,075 and 46,300