Nifty Private Bank
Last close: 20,558 (Bullish)
As the inex trades at 20,558, it experienced a minor dip upon opening, but managed to recover throughout the day, and close near day’s high levels. This pattern, therefore, suggests that the index is poised to outperform in the near term.
Upon analyzing the technical indicators, the index is found to be in close proximity to the Bollinger lower band, and the MACD histogram indicates a positive divergence.
Considering these factors, the most effective trading strategy for traders in the near term would be to purchase the index and its constituents at the current market price or at dips. The target expected for this trading strategy is 20,950.
In conclusion, the index has demonstrated a bullish pattern, supported by technical indicators, indicating a positive outlook for traders in the short term. We suggest investors to buy the index and its constituents at the current market price or dips.
Nifty PSU Bank
Last close: 3,643.95 (Range Bound with Bullish bias)
As it trades around 3,643.95, the index exhibits a range-bound trading pattern on hourly charts.
The index is currently presenting two critical levels for traders and investors to watch closely. A trade above 3,700 would be considered a positive breakout, while a trade below 3,600 would be treated as a negative breakdown. The breakout or breakdown at these levels could potentially trigger a move in either direction.
Traders and investors should keep a watchful eye on these levels as a close above or below could add a trigger in the direction of the move. If the index trades above 3,700, the next resistance levels on charts are expected to appear at 3,780 – 3,835.
Conversely, if the index trades below 3,600, the next support levels are expected to appear around 3,550 – 3,510.
Technical indicators such as the Relative Strength Index (RSI) are showing signs of a pullback, while the Parabolic SAR has turned positive. Therefore, the best trading strategy for traders would either be to wait for a breakout or for risky traders to buy at the current market price with a strict stop loss of 3,600 and a target expected at 3,780 – 3,835.
In conclusion, the index is currently presenting a range-bound trading pattern on hourly charts. Traders and investors are advised to watch the critical levels closely, as a breakout or breakdown could trigger a move in either direction.
The technical indicators are indicating a potential pullback, while the Parabolic SAR has turned positive, making it an opportune time for traders to capitalise on this market trend.
(Ravi Nathani is an independent technical analyst. Views expressed are personal).