How to trade Nifty Bank in earnings season. Anand James shares outlook
Since the majority of Nifty Bank constituents are yet to announce their figures, traders appeared more inclined to take a risk-on approach, especially since we are coming off a low base, says Anand James, Chief Market Strategist, Geojit Financial Services.
«Though the 20-day SMA at 52375 could pose some challenge to Nifty Bank’s ascent, we are counting on the oscillator divergences as well as Friday’s bullish engulfing pattern to provide enough momentum to see 53000,» he says.
Edited excerpts from a chat:
Nifty ended the third consecutive week with a loss. Do you think a bottom has been formed in the market? What are the key support levels to watch out for?
What was on display on Friday was traders adopting a risk-on approach, feasting on the bargains available as Nifty slipped below the recent low in opening trades and sunk to the lowest since late August. Post the upswing that followed, 44% of the Nifty 50 constituents are now trading above their respective 10 day SMAs, which is indeed a sign of resilience. This figure is the highest since 1st of October 2024. But, this recovery is yet to become broad based, as Nfity500 and SMIDs continue to lag. We shall hence pin our hopes on fast stochastics signalling a bottom formation, while seeking a confirmation from a push back above 24950. Towards this end, we retain our last week’s view of 25390. Downside marker meanwhile would be at 24770, with supports below seen at 24470 and 23900.
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