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Bank Nifty looking for a decisive direction!
Last Updated: 11th December 2022 - 04:53 pm
Bank Nifty formed a doji like candle on Tuesday as the close of the day was near the opening level of the day.
The Bank Nifty traded in a tight range for the second consecutive day. It declined sharply soon after opening, but in the last hour of trade, it recovered. Between, there was no significant activity. It formed a higher high and higher low candle. On an hourly chart, it is still above the moving average ribbon, and the MACD line is above the zero line. This means the index has not given any kind of weak signal. This is the fourth day of sideways trading and there is no confirmation of any technical changes in the price actions. Bearish candles are not able to get confirmation, and the indecisive candles are not suitable for directional trades. The Bank Nifty Implied Volatility is the lowest in the year at 12.71. This is the reason the premiums are not attractive to sell. It is better to wait for a range breakout. It has to close at least below the prior bar low for a weaker signal. And a close below the level of 42265 will give a confirmed weak signal. Otherwise, be positive.
Strategy for the day
Bank Nifty formed a doji like candle after a tight range of trading. A move above the level of 42500 is positive, and it can test the level of 42682 on the higher side. Maintain a stop loss at the level of 42420. Above 42682, continue with a trailing stop loss. But, a move below the level of 42300 is negative, and it can test level of 42120 on the downside. Maintain a stop loss at the level of 42420. Below the level of 42120, continue with a trailing stoploss.
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5paisa Research Team
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