Nifty Bank

NiftyBank Target Hit: 15350 and Reversal expected

Banks finally gave some strong rally and it triggered my upside target of 15350 as recommended at Lenders of Last Resort on March 2nd. Strategy recommended was to go long on 15100 Ce and Short 15500 CE. As recommended to 15100 CE should have been covered yesterday which traded last at Rs.500. and recommend to hold 15500 CE forward for next weeks strategy

As you guys can notice in the graph that a “Spinning top” has been embarked on daily charts yesterday and it has exactly pinched high at my red horizontal line  which i had intimated you guys in the last post on Nifty Bank. After such a fantastic rally, a intermediate profit booking is expected on banking stocks of almost 50% of their recent rally. Even the Gap unfilled is at 14450 which is coinciding with retrenchment level. Had been tracking options on Friday and found out that writing has been done at 15500 CE and highest Open interest stand out there too suggesting a strong resistance on closing basis.  So now traders can take a risk of going short for some gain.

Recommended Strategy:

Hold short on 15500 CE which was recommended in last post  and now buy 15200 PE 

Target: 14650 (Square-off all Options around that level)

Stop-loss: 15500 (Closing basis)


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