Banks Tanked like hell last week and i hope you guys earned full of it as i intimated the same on 23rd Sept in my post: Banks are About to Tank! Though my downside target 19200 was achieved easily but thats not the end of downside rather its just the beginning. Nifty Bank breached a upside channel on weekly charts which was intact since february low and we have closed below the same today giving a strong confirmation to previous two Gravestone Doji. Surely looking at above charts we will get biased towards getting our shorts on cards but before than i feel we would get a short covering on daily charts. Looking at indicators on daily chart, banks are too oversold and it should get some upside before going down more. Banking policy next tuesday is expected to give rate cut and much need short covering markets but that could only sustain temporarily as i feel this cut is already discounted since long.
So may be we could see some positive moment if we get rate cut better than expected but then strategy would be Sell on News rather than buying fresh. On upside 19750 is strong resistance for short term while 19900 would be my next level to short.
Buy 19350 CE Nifty bank with tgts of 19650/19850 SL: 19100