Nifty Bank outlook: Index may find support in 42,100-41,900 range; all eyes on Axis Bank, IndusInd Bank shares

Nifty Bank made a high of 42,105.40, before closing last week at 42,782, down 2.15 per cent. On the weekly chart, the banking index has formed a Bearish candle and witnessed a break of the support trendline. The RSI momentum indicator is currently trading around 42 level. The low of the bearish candle was around 42,105.40 levels, which is also the near strong support for the index. If the banking index moves on the higher side, we expect Axis Bank to outperform the Nifty Bank. Also, IndusInd Bank Ltd can be another frontrunner in private banking. In the PSU banking pack, Punjab National Bank (PNB) and Canara Bank Ltd are expected to move higher and deliver decent gains in the coming week. Private lenders such as HDFC Bank Ltd and ICICI Bank Ltd and PSU banks such as State Bank of India Ltd and Bank of Baroda Ltd may underperform. 

In the F&O segment, Nifty Bank November futures traded with 261.40-point premium to the Nifty Bank spot. The open interest (OI) distribution for Nifty Bank Put options showed that the 42,500 strike has the highest concentration, which may act as support for the current expiry. Nifty Bank Call strikes of 43,000 and 43,500 saw a significant OI concentration, which may act as resistance for the current expiry.
 

A strong support for the index is located around 42,100-41,900 range. If the Index closes below the mentioned support, one can see further downside in Nifty Bank.

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