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Bank Nifty opened today’s session with a gap-up at 53,358 versus yesterday’s close of 53,089. But the index turned south and declined. It is now hovering around 52,880, down 0.4 per cent.
Corroborating the bearish bias, the advance-decline ratio is currently at 2:10. ICICI Bank and Kotak Mahindra Bank, up 1.7 and 0.6 per cent, respectively, are the only gainers in the index. Leading the fall is HDFC Bank, losing 1.9 per cent.
Nifty Private Bank is down 0.3 per cent whereas Nifty PSU Bank has lost nearly 0.5 per cent.
Bank Nifty futures
Bank Nifty futures (July contract) opened today’s session higher at 53,251 versus yesterday’s close at 53,091. But it fell soon after and is currently trading at 52,940, down 0.3 per cent.
Although Bank Nifty futures has been facing selling pressure, the broader trend is bullish and there are supports ahead. The nearest support levels are 52,770 and 52,300. Just below these is a key base at 52,000. Hence, the downside can be limited.
However, if Bank Nifty futures falls below 52,000, the short-term outlook can turn bearish.
On the other hand, if the contract recovers, it is likely to face resistance at 53,300. Potential resistance above this are 54,000 and 55,000.
Overall, the trend is up and the declines can be considered as opportunities to initiate fresh long positions.
Trading strategy
Stay on the fence and buy Bank Nifty futures if it drops to 52,500. Target and stop-loss can be 54,000 and 51,800 respectively.
Supports: 52,770 and 52,300
Resistance: 53,300 and 54,000
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