Trading strategies for Nifty PSU, Private Banks & Financial indices

According to Ravi Nathani, an independent technical analyst, the Nifty Financial Index seems to be in a discernible downtrend.

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Ravi Nathani Mumbai

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Analyzing Trends in Financial Indices: A Tactical Trading Approach

Nifty Financial Service Index
Last close: 19,918.50

As the Nifty Financial Service Index stands at 19,918.50, a discernible downtrend is observed on the charts, with anticipated support at 19,664 and 19,336.

The recommended trading strategy aligns with selling on upward movements or patiently waiting for these support levels to materialize before considering fresh long positions.

It's imperative to note that the bullish sentiment may remain subdued until the index closes convincingly above 20,300, signaling caution for the near and short term.

Nifty PSU Banks Index
Last close: 6,637.05

The Nifty PSU Banks Index, currently at 6,637.05, showcases a bullish short-term trend, accompanied by an ongoing pullback phase. Anticipated support levels are identified around 6,500, 6,380, and 6,225.

The recommended trading strategy for traders involves strategically buying around these support levels to capitalize on a potential quick bounce, aligning with the prevailing bullish trend.

However, it's crucial to exercise caution at the current market price (CMP), as stiff resistance is expected around 6,725. Risk-oriented traders may consider short positions at the bounce, with identified support levels as potential targets for short trades.

Nifty Pvt Banks Index
Last close: 22,532.70

The Nifty Pvt Banks Index, positioned at 22,532.70, manifests a bearish near-term trend on charts, with anticipated support levels around 22,150 and 21,700.

Traders are advised to consider buying the index and its constituents around these support levels for a technical bounce. Notably, shorting at the current market price (CMP) is discouraged, and traders are encouraged to hunt for opportunities to buy around the identified support levels.

Conclusion:

In conclusion, the financial indices present a spectrum of trading opportunities, each demanding a distinct approach.

The Nifty Financial Service Index calls for caution, favoring selling or patiently waiting for support levels. The Nifty PSU Banks Index provides opportunities for strategic buying during pullbacks, but traders should navigate the stiff resistance at the CMP judiciously.

Meanwhile, the Nifty Pvt Banks Index signals a bearish trend, advocating a careful approach with an emphasis on buying around identified support levels. Traders are reminded to stay adaptable, disciplined, and informed, aligning their strategies with the evolving dynamics of each index for optimal trading outcomes.

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

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First Published: Feb 13 2024 | 6:24 AM IST

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