Traders can adopt 'buy-on-dips' strategy for Nifty Pvt Bank: Ravi Nathani

According to the technical analyst, traders can employ 'buy-on-dips' strategy for Nifty Private Bank, Nifty PSU Bank, and Nifty Financial Services indices

Nifty Private Bank
Last close: 19,956.70

The index has demonstrated an impressive recovery, as indicated by its sharp bounce from the lows of the previous day, which portends some promising prospects in the near future.

In the last two weeks, the index has suffered a substantial decline, causing it to enter the oversold territory, and opening up the possibility of a technical resurgence.

The magnitude and rapidity of the index's descent imply that any ensuing recovery is likely to be equally sharp, calling for traders to exercise vigilance and adopt a stringent stop-loss approach set at 19,725.

Traders seeking to profit from potential buying opportunities at lower levels should set their sights on the index or its constituents, with targets set at 20,500 and 20,800.

Nifty PSU Bank
Last close: 3,624.55
 

Charts suggest that the index underwent steep correction and is presently consolidating within the range of 3,725 to 3,536. A decisive break above or below this range would likely serve as a trigger in that particular direction.

Given the current circumstances, traders would be best advised to employ a strategy of purchasing near support levels and selling close to resistance levels until a breakout materialises.

A move above the upper range of 3,725 could pave the way for further gains, with potential targets at 3,864 and 4,000. Conversely, a close below the lower range of 3,536 could signal support levels around 3,390, which would represent a near-term oversold zone for the index.

Nifty Financial Services
Last close: 17,560.15
 

Charts suggest that the index displays hourly trading patterns within a range of 17,750 to 17,260.

However, the daily charts reflect oversold market conditions, which could trigger a breakout toward the higher side.

If the index were to trade and close above 17,750, the ensuing resistance levels would likely be at 18,080 and 18,500.

Therefore, traders are advised to employ a trading strategy that involves purchasing the index and its constituents at lower levels, with a stop loss set at 17,260 and a target range of 18,080 to 18,500.

(Ravi Nathani is an independent technical analyst. Views expressed are personal)