NSE Bank Nifty index is close to touching a new peak of 43,000. The banking index has rallied over 14 per cent so far this year, outperforming benchmark NSE Nifty 50, which has risen around 3.4 per cent. Analysts see further upside in the Bank Nifty in the run up to the Union Budget 2023. They believe that the banking index may touch 45000 in the coming months. On the downside, the index may see a correction towards 38000 if it falls below 41500. Investors can continue to use dips as buying opportunities, keeping the stop loss at 41500.
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Trade Bank Nifty on long side, use all down moves to buy
“Bank Nifty has staged a major breakout as it moved above 41800 levels. So long as the index stays above this level, this breakout will remain valid and in force. The technical measurement implications put the targets for Bank Nifty at 44500-45000 levels over the coming months. So far as investors are concerned, when it comes to trading Bank Nifty, they must trade it on the long side by using all available downsides to make entries and buying it. This view will stand negated if the index slips below 41500 levels,” said Milan Vaishnav, CMT, MSTA, Consulting Technical Analyst and founder, Gemstone Equity Research & Advisory Services. In the run-up to the Union Budget, investors must keep an eye on S&P holding above 3600 levels, he added.
Buy on dips till Bank Nifty holds 42000
“Bank Nifty index has been consolidating since the past 3-4 trading sessions and is unable to close above the level of 42500. The index remains in a ‘buy on dip mode’ as long as it holds the support of 42000 on the downside. For the bulls to gain full control, the index needs to cross 42700 level. The index is showing signs of exhaustion at the higher level but still, a confirmation is needed on a closing basis. The index – if it manages to hold the major support cluster of 42000-41500 – can witness an upside to 44000. However, if the index fails to hold the mentioned support zone, it can aggravate correction towards 39,000-38,000 levels,” said Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities.
“Downside is possible only if the index breaks the level of 41500 on a closing basis as that will give the bear the upper hand. In the run-up to the Union Budget, the bulls should watch out for levels of 41500 which should act as strict stop loss on the downside. The bears need to watch the level of 42700 if breaches on the upside can lead to sharp short covering on the upside,” Shah added.
Bank Nifty likely to touch 44000 till Union Budget 2023
“Domestic equity indices have bounced back sharply from its recent low and now appear to be on track to set new records. Banking stocks are likely to outperform due to an increase in credit demand resulting in higher net interest income as well as fee-based income. September quarter numbers support the index to sustain above the previous all-time high. At the current situation, there are no real substantial threats unless inflation is out of control and interest rates need to be dramatically increased from these levels. Stability in the global market and increasing FII participation boosts market confidence significantly. We can expect the 44000 level till the Union Budget,” said Akhilesh Jat, Category Manager – Equity Research, CapitalVia Global Research.
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Nifty, Sensex, Bank Nifty today
Indian benchmark indices were trading lower on Friday. While Sensex fell over 300 pts, Nifty 50 slipped around 100 pts to trade below 18250 levels. Meanwhile, Bank Nifty which started the day with gains also slipped to trade marginally lower on the week’s last trading day.