On Monday, March 20th, the Bank Nifty closed at the level of 39361, which is 236 points below the previous day’s close. It was anticipated that if the market opens in the range of 39,270 to 39,400 and spends some time in this range, it would be a good opportunity to enter into the market. The market opened in this range, but it went down to the level of 39050 before taking support and reversing to the level of 39444. However, at the level of 39444, Bank Nifty faced resistance and slid down to 39050, breaking the day low and touching the level of 38949. After spending some time in the range of 39050 to 38949, Bank Nifty broke the level in Uptrend and touched the level of 39361 before closing there.
It is positive to note that Bank Nifty closed above the level of 39270, indicating that the market is not weak. If the market had closed below 39270, it would have been weak for the intraday session. When analyzing the Bank Nifty chart in a 15-minute time frame, it becomes clear that Bank Nifty has strong support at the range of 39000 to 38950 and strong resistance at the levels of 39456, 39752, and 40000.
Looking at the option chain analysis, the maximum PUT writers are at the levels of 39000, 38500, and 38000, which act as the support for the Bank Nifty, while the maximum CALL writing is at the levels of 39500, 40000, and 40500, which act as the resistance for the Bank Nifty.
For the trading session on Tuesday, March 21st, the trade setup is as follows:
If the Bank Nifty opens above today’s opening range of 39505 and sustains the level for some time, then the first target is 39643, the second target is 39752, and the third target is 39907. This target can only be achieved if Bank Nifty opens above 39505.
If the Bank Nifty opens in the range of 39350 to 39456 and spends some time in this range and then crosses the level of 39425, the target is 39500. If the Bank Nifty sustains this level, the targets mentioned previously can be achieved.
If the Bank Nifty breaks the level of 39375 after spending some time in the range of 39350 to 39456, the first target is 39190, and the second target is 39000.
If the Bank Nifty opens with a large gap-up or gap-down, traders are advised to follow the price action and candlestick pattern. The important thing to note is that the Bank Nifty creates the range first and then takes any direction. So, there is no hurry in trading, and traders should be patient and let the Bank Nifty come to their setup before trading.