Bank Nifty got confirmation of bearish engulfing pattern!

resr 5paisa Research Team

Last Updated: 13th December 2022 - 09:35 pm

Listen icon

Bank Nifty on Monday ended lower by 1.77% and in the last two days it has lost nearly 3.5%. 

On Monday, it opened with a negative gap and sustained below the opening level. It confirmed the bearish implications of the prior day's engulfing candle. It declined below the 13EMA. It took support at four-day tight range consolidation high. It filled the gap of August 11. The RSI has declined sharply below the 60 zone. It has also closed below the prior swing lows. The MACD has given a fresh sell signal, while the negative momentum indicator -DMI surged sharply. By closing below the previous week's low, the index also got the confirmation for the weekly shooting star candle. 

 Bank Nifty declined by 3.80% from the Friday high in just two trading sessions. The 20DMA support is just 0.62% away at the level 38060. A close below this level will fuel further selling pressure. The Elder impulse system has formed a strong bearish bar. The KST and TSI indicators have given fresh sell signals. For now, it is better to stay away from the long positions if it forms lower high bars. There may be some sharp bounces as the monthly expiry is on the cards. 

Strategy for the day 

Bank Nifty extended its losses for the second straight day and with this it got confirmation of bearish engulfing pattern. Furthermore, the Bank Nifty also closed at the low. Hence, the be with a negative bias. Only a move above the level 38390 is positive, and it that case it can test the level of 38592. Maintain a stop loss at 38300. But, a move below 38290 is negative, and it can test the level of 37800. Maintain a stop loss at 38385. Below 37800, continue with a trailing stop loss. 

FREE Trading & Demat Account
Open FREE Demat Account with endless opportunities.
  • Flat ₹20 Brokerage
  • Next-gen Trading
  • Advance Charting
  • Actionable Ideas
+91
''
By proceeding, you agree to our T&Cs*
Mobile No. belongs to
hero_form

Indian Stock Market Related Articles

Top Energy ETFs in India - Best Funds to Invest

by 5paisa Research Team 11th Dec 2024

Top 5 Nifty 50 ETFs in India by Returns

by 5paisa Research Team 11th Dec 2024

Top Multibagger Stocks for the Next 5 Years in India

by 5paisa Research Team 4th Dec 2024

Top Growth Stocks Trading at a Discount

by 5paisa Research Team 4th Nov 2024

Disclaimer: Investment in securities market are subject to market risks, read all the related documents carefully before investing. For detailed disclaimer please Click here.

Open Free Demat Account

Be a part of 5paisa community - The first listed discount broker of India.

+91

By proceeding, you agree to all T&C*

footer_form