Bank Nifty forms an inside bar!

Bank Nifty forms an inside bar!

Indian Market
by 5paisa Research Team Last Updated: 2022-12-08T22:18:45+05:30

Bank Nifty plummeted more than 1.5% on Monday and it formed an inside bar and declined below the 38.2% retracement level once again.

After almost testing the 50DMA on Friday, the banking index failed to reach the previous day high. As an inside bar rule, Friday's high of 38811 and low of 37386 will be a crucial range for the index for the next two days. In any case, if this range is broken, we will see a directional bias. On the hourly chart, the index sustained below the moving average ribbon after the first hour of trading. The MACD line is also below the zero line. For a bullish bias, the index has to sustain above 38395 for at least an hourly closing.

In any case, if it fails to move above 38271, the chances of testing Friday low are high. Above 38295, it may test the Friday high and even 50DMA of 38936. Let us wait for a clear directional move above or below Friday's high and low. As the news flow is impacting the market movements, it is better to wait for confirmed trade

Strategy for the day

Bank Nifty closed at the low of the day and it has formed an inside bar as the price traded within the high and low of the prior trading session bar. Going ahead, a move above the level of 38140 is positive, and it can test the level of 38395 on the higher side. Maintain a stop loss at the level of 38030. Above, 38395 continues with a trailing stop loss. But, a move below the level of 38030 is negative, and it can test the level of 37880 on the downside. Maintain a stop loss at the level of 38140. Below the level of 37880, continue with a trailing stop loss.

 

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