Banknifty/Nifty: Correction Over or More Downside Ahead?

Yesterday’s Pick

NIFTY 30MAY24 FUT SELL Rs 8500 ( Per 2 lot)
FINNIFTY 14 MAY 21350PE Rs 16000 ( Per 5 Lot )
BANKNIFTY 15 MAY 47900PE Rs 1800 ( Per 10 Lot )

Banknifty Technical View

Bank Nifty has been on a downward trend for the seventh consecutive day, showing a significant bearish signal with a long candlestick pattern on the daily chart. Moreover, it has dropped below the important 50-day exponential moving average (EMA) in closing terms. Analysts suggest that the index could find support around 47,400, and if it falls below this level, selling pressure might escalate towards 47,050. On the other hand, there’s a resistance around 48,000, marked by active Call writing. If the index manages to break above this resistance decisively, it could trigger short-covering rallies towards 48,500.

Indian Vix
Volatility has been steadily increasing, making the market trend more favorable for traders and causing discomfort for bullish investors. India VIX, known as the fear index, rose by 6.55 percent to reach 18.2 levels, its highest closing level since October 17, 2022. This marks a total uptrend of 78.5 percent over the past 11 consecutive sessions.

FII and DII data
On May 9, foreign institutional investors (FIIs) sold net shares worth Rs 6,994.86 crore, whereas domestic institutional investors (DIIs) purchased shares worth Rs 5,642.53 crore, according to provisional data from the NSE.

Put Call Ratio
The Nifty Put-Call ratio (PCR) surged to 0.90 on May 9, up from 0.77 in the previous session. A rising PCR, especially above 0.7 or surpassing 1, signifies that traders are selling more Put options compared to Call options. This typically suggests a strengthening bullish sentiment in the market. Conversely, if the ratio drops below 0.7 or approaches 0.5, it indicates that selling in Call options outweighs selling in Put options, reflecting a bearish sentiment in the market.

Stocks in the news

Drug maker Abbott India Ltd has reported a 24 percent year-on-year (YoY) growth in net profit at Rs 287 crore for the fourth quarter of the financial year 2023-24. The company’s revenue increased 7 percent to Rs 1,439 crore from Rs 1,343 crore in the year-ago period, Abbott India said on May 9. The company’s board recommended payment of final dividend of Rs 410 per equity share of Rs 10 each for the year ended March 31, 2024, subject to approval of the shareholders

Larsen and Toubro
which has a presence across sectors including, defence, infrastructure, power, construction, technology and finance among others, plans to continue its investments into the Middle East region while adopting a more broad-based approach. According to the management of the diversified conglomerate, the investments in Middle East will not be limited to hydrocarbons but will extend to infrastructure building while developing the region as a tourist destination.

Nifty and Bank Nifty Support and Resistance level


Resistance 21,920, 21,830 and 21,690 levels.
Support 21,990, 22,300 and 22,440 levels.

Resistance 47,420, 47,225 and 46,910
Support 47,560, 48,235 and 48,550

Index Future levels

Nifty Futures Buy above 22000.The suggested targets for this are 22,200 and 22,300, with a stop loss set at ,21,850

Bank Nifty future buy near 47250 index is expected to up side levels of 47600 and 47700 and level 46900 will act as a stop loss.

Today’s Technical Pick : Infosys

Infosys: Buy at ₹1442, target ₹1512, stop loss ₹1400.

Infosys Ltd is a global leader in consulting, technology and next-generation services. Founded in 1981, the company is headquartered in Bengaluru, India and has offices in over 50 countries.

Infosys provides services across multiple industries, including banking, manufacturing, healthcare, retail and more. The company’s core services include IT consulting, software development, enterprise solutions and digital transformation. Infosys also offers cloud, analytics, artificial intelligence, blockchain, Internet of Things (IoT) and robotic process automation (RPA).

Infosys’s top products include its Finacle core banking solution, EdgeVerve Systems, which provides enterprise software, and Mana, a cloud-based AI platform. The company also offers popular brands such as NIA, its artificial intelligence platform, and Panaya, its cloud-based ERP suite.

The current price of Infosys shares is ₹1439.50. Recent market movements, including a neutral candlestick pattern signaling a potential reversal from the bottom, along with strong trading volume, suggest a bullish turnaround. These patterns indicate a promising upward trend in the stock, making it an attractive investment opportunity.

The Relative Strength Index (RSI) is currently at 43.3 and is showing an upward trend, indicating a notable increase in buying momentum. Both RSI and Stochastic RSI are in the overbought region, suggesting that positional traders may want to hold onto their positions and consider implementing a trailing stop-loss strategy.

Happy Trading!

Commodity Samachar
Learn and Trade with Ease

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