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Remain bullish, play in that direction
Remain bullish, play in that direction
A volatile expiry, diverging Indices and mixed global cues, an action-packed day for Intraday traders.
A volatile expiry, diverging Indices and mixed global cues, an action-packed day for Intraday traders. BankNifty marked a new all-time high of 40,200.45 and closed above 40,000. It was also a fourth consecutive bearish day for Nifty making three black soldiers on the daily chart. The session was clearly a day where we can see BankNifty sustaining the lower levels and was in a very tight consolidation while on the other hand Benchmark Index, Nifty was continuously seeing profit booking ahead of The Reliance result.
The divergence was clear signalling the strength in the Niftybank. As previously shared, the fresh money is moving to Financials and that was visible with the advance-decline ratio rising along with many of the banks showing strength. Niftybank is still at very early levels of a bullish run-up and in the short to mid-term may continue to outperform. Given its price action is in unchartered territory, we believe lower levels of 39,500 – 39,300 will act as support. PSU bank stocks like Federal Bank, Bank of Baroda, Canara Bank may see further momentum on the higher side. Private Banks may see momentum as well with Kotak, ICICI and Axis Bank Leading.
Nifty on the other hand has seen some decent correction as advised, given the expansion we have seen lately. The supports have been tested at 18,197 while on the downside 18,008 – 18,050 is very strong support. We may see long term trend continuation as far as Nifty sustains these levels.
The global cues which have been weak lately have also improved with DJIA and S&P trading near all-tim highs. Amid recent correction, the broader trend must be kept in mind which is bullish and that is the direction one must play, not against it.
(The author is Technical Analyst, Finversify)
