Bank Nifty index is forming a bearish head and shoulders patter and can rapidly correct to 29,500. Even at current price of 30,468, the price is below the 10 day simple moving average (SMA), which indicates weakness. For Bank Nifty index, the final support is at 29,500. Investors and Traders should exit Bank Nifty below 29,500.
Nifty futures have been weak since 23 Jan 2020, and they are in the selling zone currently, and they lose ground rapidly. Gains made in 5-10 days can be lost in 1-2 days. The weekly chart shows clear weakness, with falling momentum. Nifty futures have support at 11,700 but we can’t be sure it will hold.
The 10 week SMA on the weekly chart has started curving down, and it takes several weeks of correction and consolidation to get back into an uptrend. We should not expect any support from the 50 week SMA because it has not worked in the past. So it looks like Nifty can see 300-500 points correction before a new uptrend.
