Nifty Bank falls more than 1% in a week; breakout above 47,700 may trigger short covering move
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The Nifty Bank fell from 48,143 as on 15th December 2023 to 47,491 recorded on 22 December 2023, which translates into a fall of 1.3% in a week. The Nifty50 closed with gains of 94 points at 21,349 on Friday.
Top index losers include names like Canara Bank, SBI, ICICI Bank, HDFC Bank, and AU Small Finance Bank while some selling was seen in Kotak Mahindra Bank.
SBI and Canara Bank closed with losses of more than 1% each.
The Nifty Bank underperformed the Nifty50 index on Friday but managed to hold on to crucial support levels. However, for bulls to take control a breakout above 47,700 level is required that could take the index towards 48,000.
“The Bank Nifty index faced selling pressure on the last day but managed to hold the key support level of 47,400. If the index fails to sustain above this support, it could witness further decline toward the 47,100 levels,” said Kunal Shah, senior technical and derivative analyst at LKP Securities, said.
“On the upside, the immediate resistance is at 47,700, and a breakout above this level may trigger short covering, pushing the index higher toward 48,000-48,200 levels,” he said.Levels To Track:
The Nifty Bank index opened on a flattish note on Friday and remained highly volatile in a broader range of 500 points for most of the session. The index formed a small-bodied candle on the daily charts.
“Nifty Bank formed a small bearish candle on daily and weekly scale, which suggests some pause at higher zones. However, the index has been consolidating in a wider range in between 47,000 and 48,200 zones from the past six sessions as banking stocks continued to underperform,” Chandan Taparia, senior vice president, Analyst-Derivatives at Motilal Oswal Financial Services Limited, said.
“Now it has to cross and hold above 47,500 zones for an up move towards 48,000 then 48,219 marks while a hold below the same could see weakness towards 47,250 then 47,000 levels,” recommended Taparia.
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(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
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