Bank Nifty drove the market higher in last few months. Now, the Bank Nifty seems to be stalling and with it the market. Over next few days and weeks leading up to Budget - the big question: What will Bank Nifty do?
Here's the Bank Nifty Weekly Chart
Click on the chart for Bigger View
As you can see in the weekly chart above: Bank Nifty has broken out above 13300 - level which was earlier the resistance. Now, on every pullback this level will act as strong support for the market. Going ahead - Bank Nifty can do either of the following -
1. Do sideways consolidation between 14700 and 15720 for next few weeks before resuming uptrend again
2. Pullback to 13300 - retest it for few weeks and then resume with upmove again. The second option will make the move healthy and will be good for market for long run. The only problem is that pullback is of 10% magnitude and it can create some short term panic considering how optimistic everyone is right now.
Well, we will see what happens. On Bank Nifty - keep an eye on two levels: 1. Consolidation support of 14700; and if that breaks then 2. Support of 13300.
Recent Post on May 30: Rupee Rally over? - I covered the INR when it was at 58.9 and yesterday it closed at 60.15
The blogpost is purely for educational purpose. Please do your own due diligence before trading