Nifty Fin Svcs, PSU Bank Rangebound; Time To Be Cautious? What Analysts Say

3 min read Last Updated : Oct 15 2024 | 7:15 AM IST

Nifty Financial Services Index: Range-Bound Movement

The Nifty Financial Services Index is currently trading within a well-defined range of 23,900 to 23,100. This range-bound pattern indicates consolidation in the market. Traders should watch for a close above or below this range, as it will likely trigger a directional move.

If the index breaks the upper boundary of 23,900, the next resistance levels to watch are 24,175 and 24,400. Traders looking for bullish opportunities should wait for this breakout before entering long positions. On the downside, if the index falls below 23,100, it may trigger selling pressure.

The next support levels on the charts would be 22,925 and 22,650. In this case, traders should consider waiting for these support levels before initiating fresh buy positions.

Best Trading Strategy for now, is to wait for a decisive breakout in either direction. Riskier traders could consider trading within the range by buying near the support levels and selling near the resistance, but the safer approach would be to wait for a confirmed breakout.

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Nifty PSU Bank Index: Range-Bound with Key Levels

The Nifty PSU Bank Index is also trading in a range-bound pattern, with a defined range of 6,700 to 6,510. This consolidation phase suggests that the index is taking a breather, and a breakout in either direction will provide clarity on the next move. If the index breaks above 6,700, the next resistance levels are 6,790 and 6,950. Traders looking to capitalize on a bullish trend should consider buying after a confirmed breakout above 6,700.

If the index falls below 6,510, further downside could be seen, with support at 6,420 and 6,260. Traders should avoid buying in the range until support levels are tested.

Best Trading Strategy: Like the Nifty Financial Services Index, traders should adopt a cautious approach and wait for a clear breakout before taking new positions. Risk-takers can trade within the range by buying near support and selling near resistance, but maintaining a stop-loss based on the breakout levels is essential.

Conclusion

Both the Nifty Financial Services Index and the Nifty PSU Bank Index are consolidating within well-defined ranges. A breakout in either direction will trigger strong moves, so traders should remain patient and wait for the respective ranges to break. For now, the best strategy is to trade cautiously within the range or wait for a breakout before taking new positions.

(Disclaimer: Ravi Nathani is an independent technical analyst. Views are his own. He does not hold any positions in the Indices mentioned above and this is not an offer or solicitation for the purchase or sale of any security. It should not be construed as a recommendation to purchase or sell such securities.)

First Published: Oct 15 2024 | 7:15 AM IST