Nifty Bank opened today’s session lower at 49,212 versus yesterday’s close of 49,259. If declined further after opening and is currently at 48,910, down 0.7 per cent.
All 12 stocks in the index are in the red, led by IDFC First Bank, down 2.9 per cent. Following this is AU Small Finance Bank, down 2.2 per cent.
Nifty PSU Bank has lost 1 per cent so far today and Nifty Private Bank is down 0.6 per cent. Therefore, broadly, the public sector banks are facing higher selling pressure than their private peers.
Bank Nifty futures
Nifty Bank futures (February contract) opened today’s session at 49,460 against yesterday’s close of 49,462. It is now trading at 49,060, down 0.8 per cent.
Although there are bearish signals, the contract has a support at 49,000. If this level is breached, Nifty Bank futures can drop to 48,500.
On the other hand, if the contract rises on the back of 49,000, it can face resistance at 49,200 and 49,500.
Broadly, given the current conditions, the likelihood of a fall looks higher. But traders can wait for the contract to take out the support at 49,000 before initiating fresh trades.
Trading strategy
Short Nifty Bank futures if it slips below 49,000. For intraday, target and stop-loss can be 48,500 and 49,250 respectively.
Supports: 49,000 and 48,500
Resistance: 49,200 and 49,500