Bank Nifty index is trading lower. The index fell to a low of 47,844 and is now attempting to recover from there. It is currently trading at 48, 100, down 0.55 per cent. The advances/declines ratio is at 2:10. This is negative and indicates that the bounce that is happening now could be short-lived.
Bank Nifty outlook
Support is around 47,800 which is holding well for now. However, resistances are 48,300 and 48,700 which can cap the upside. The outlook is bearish. We expect the Bank Nifty index to break 47,800 eventually and fall to 47,400-47,300 first and then 47,000 eventually in the coming days.
Bank Nifty Futures
The Bank Nifty Futures (48,090) is down 0.6 per cent. The contract has support at 47,700 which is holding well for now. It touched an intraday low of 47,722 and then has risen back well from there. If this bounce sustains, there are good chances to see a rise to 48,300 and even 48,600.
However, the broader picture is negative. We expect the Bank Nifty January Futures contract to break 47,700 and fall to 47,200-47,000 if not today but going forward this week eventually.
Trade Strategy
Traders can go short below 47,700. Keep the stop-loss at 47,920. Trail the stop-loss down to 47,660 as soon as the contract falls to 47,580. Move the stop-loss further down to 47,540 when the contract touches 47,480. Exit the shorts at 47,240.
Supports: 47,700, 47,200
Resistances: 48,300, 48,600
