BANKNIFTY [17th July 2020]

The expiry was rangebound but held 21000-21150 decisively, closing the day back within the trend channel. A strong buy by DIIs, a weakening Dollar, a double bottoming out of Stochastics on the hourly chart and maintaining the rising trend channel, all point towards a retracement against the recent fall of roughly 2000 points on the index. So, one can expect a retracement of at least 1000 points from 21100. By that logic, the index should be trading above 22000 in the coming week.

On the upside, the 2 weeks' EMA is placed at around 21800 beyond which a major hurdle lies at 22040. If the index manages to breach 21800 with volume , one can look at going long for a target of 22040 to 22480 ultimately.

On the downside, there are multiple supports within 100 points range which are placed at 21000-20900-20800. In case the trend channel is broken again, with a gap down and a dead cat bounce, the index can correct up to the above levels, and a decisive breach of 20800 would further lead to corrections of up to 20500-20100.

The broader range of next week's expiry should remain between 21000 and 22500.

*Note:- The levels mentioned above should be used as approximation.

The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.