Charts suggest 41,569 as trend changing level on Bank Nifty: Ravi Nathani

According to the technical analyst, the if the Bank Nifty fails to hold 41,569 the trend may bearish in the short term.

Nifty

Last close: 17,914.15

On technical charts, yesterday’s performance of the Index has covered the complete candle and closed below its low, this indicates weakness or selling pressure was immense. 

However, if we see the last 12 day's Nifty performance, Index is trading in a range of 18,265 – 17,775 until we don’t get any breakout on charts, it would be advisable for traders to buy near support and sell near resistance levels mentioned.

Technical Indicators like MACD are still weak on daily charts, whereas the current position of the 20-day exponential moving average is at 18,142 which is 228 points away from the current market price and it is in a downtrend whereas 200 days exponential moving average is trading flat at 17,882 which is just 32 points below current market price, resulting a range bound with mild bearishness until we get a breakout above 20 DEMA.

As Index is very close to its lower end of the range, one could expect mild bearishness tomorrow whereas buying would be expected at lower levels, therefore the best trading strategy for traders would be to buy near the support range mentioned below for a technical bounce, as we will see a very volatile trend in the market.

Intraday Resistance range: 17,940 – 17,991 / 18,050 – 18,125

Intraday Support range: 17,836 – 17,810 / 17,660 / 17,481

Bank Nifty

Last close: 42,014.75

From the high of December 14, 2022 till December 26, 2022 the Index corrected 5.85 per cent (2,582 points) in nine trading sessions which will be considered as one swing, then a technical bounce of 2,009 points in eight trading sessions made a lower top at 43,578 which could be viewed as second swing.

Now the current corrections from the high of second swing has already corrected 1,743 points in just 5 trading sessions, which means a low below December 26, 2022 will get a lower bottom on charts resulting a bearish trend for the short term.

As per levels traders have to watch the 41,569 which will be a trend change level from flat to bearishness for the short term.

So as per levels, traders, the best trading strategy will be to watch 41,569 closely as trade below this level will directly bring the support at 41,064 and 40,350.

In simple words, all long positions shall keep a strict stop loss of 41569 whereas on the bullish side trade above 42,780 which is also a 20 DEMA should act as a positive breakout for near & short-term trading.

Intraday Resistance range: 42,175 – 42,225 / 42,510 – 42,536 / 42,780 - 43,000

Intraday Support range: 41,836 – 41,810 / 41,700 - 41,675 / 41,500

(Ravi Nathani is an independent technical analyst. Views expressed are personal).