Bank Nifty opened today’s session with a gap-down at 53,459 versus yesterday’s close of 53,578. It slipped further after opening and is now at 53,350, down 0.4 per cent by the end of the first hour of trade.

Barring The Federal Bank, up 0.3 per cent, all other stocks in the index are in the red. Thus, the advance/decline ratio is 1/11. ICICI Bank and Punjab National Bank, down nearly 1 per cent each, are the top losers.

Within the banking space, the private sector banks are facing higher selling pressure so far today. Nifty Private Bank is down about 0.4 per cent whereas Nifty PSU Bank has lost 0.25 per cent.

Bank Nifty futures

Bank Nifty futures (December contract), like the underlying, began today’s session lower at 53,605 against yesterday’s close of 53,700. It is now hovering around 53,525, down 0.3 per cent.

Although we can see a good amount of selling pressure on the contract, it is sustaining above a key support at 53,400. Until this level holds, the bulls will have an upper hand. That said, we need to wait for the breakout of 53,750 in order to be certain of the upswing to extend.

A breach of 53,750 will confirm a triangle pattern, according to which the contract can rally to 54,250 in the near-term. A move beyond 54,250 can lift Bank Nifty futures to 55,000 over the next few sessions.

However, if the contract declines below the base of 53,400, it can fall further. Nearest potential support below 53,400 are at 53,000 and 52,750.

 Considering the above factors, the price region between 53,400 and 53,750 is not a favourable band for initiating fresh positions.

Trading strategy

Go long if Bank Nifty futures (December) breaks out of 53,750. Target and stop-loss can be 54,250 and 53,500 respectively.

Supports: 53,400 and 53,000

Resistance: 53,750 and 54,250