Nifty Bank drops over 1%; should traders adopt a sell-on-rise strategy?

was the only gainer while selling was seen in , and that were down more than 3% each.

The Nifty Bank seems to have made an intermediate top after hitting a record high of 49,974 on 30th April 2024. Experts advise traders to adopt ‘sell on rise’ as long as the trades below 49000.

“Bank Nifty breached its 4-day low of 48,659 within the first hour and closed near 48,285. It was one way downside rally for in the first couple of hours after which consolidated sideways,” Bhavik Patel- Senior Research Analyst, , said.

“The downside rally seems overstretched intraday and that is why sellers opted to book some profit near the market lows. On the daily scale, Bank Nifty also breached its 20-day moving average which was until now acting as ,” he said.

“The next downside support for the market comes around 47,730 which is the swing low made on 25th April,” highlights Patel.

“On the higher side, 49,000 is the immediate and as long as market remains below 49,000, traders should opt for sell on rise strategy,” he recommended.

The Nifty Bank opened higher, but it failed to hold on to the momentum. Bears took control in the first half of the trade and pushed the index towards 48200 levels.

The Nifty Bank is trading below 5,10, and 20 DMA but above 50, 100, and 200 DMA on the daily charts. The recent price action suggests that bears could push the index lower if the momentum doesn’t pick up.

“The Bank Nifty opened on a bullish note, but due to heavy selling pressure. Technically, on a weekly basis, the index formed a formation near its all-time high, indicating strong resistance near 49,975,” Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Interrmediates Ltd., said.

“Furthermore, the index broke the previous week's low of 48,342.7. As long as the index remains below 48,340, weakness could extend to 48000-47,700,” he said.

“In the short term, 48,000 and 47,700 will serve as support points, while 49,000 and 50,000 will operate as resistance,” he recommended.

(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)