Nifty Bank support at 43,270 level; keep an eye on Axis Bank, Canara Bank, SBI, says Sumeet Bagadia

Nifty Bank exhibited a notable bullish sentiment on the weekly chart, culminating in the formation of a bullish candle that concluded at the 43,820.10 level. This ascent followed a temporary dip to 43,283.85 levels earlier in the week near 200-day EMA level. Concurrently, the Relative Strength Index (RSI) momentum indicator hovers around the 49 level, indicating a moderate but no overbearing sentiment in the market.
 

In the weekly context, the index reached a high of 43,908.70, which was close to its 50-day EMA level. This weekly close marked a commendable 1.16 per cent rise for the banking index on weekly basis.
 

Transitioning to the daily charts, a robust support level can be discerned at 43,270, which is close to the 200-day EMA level. The viability of this support is paramount, as a breach of this level may usher in a more bearish outlook for the Nifty Bank. Notably, in the event of an upward trajectory, the expectation is that Axis Bank will exhibit a superior performance within the private banking sector, whereas PSU banks like Canara Bank and SBI are anticipated to yield commendable gains in the upcoming week.
 

Nifty Bank November futures are currently trading at a premium of 195.30 points compared to the Nifty Bank spot. Analysis of the Open Interest (OI) distribution for Nifty Bank Put options reveals that 43,500 hold the most substantial concentration. This level is poised to serve as a critical support point for the current expiration period. On the other side, Nifty Bank Call strikes of 44,000 and 40,500 exhibit notable OI concentrations, signifying potential resistance levels for the current expiry cycle.

Note: The author of this article is Executive Director at Choice Broking.

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