Bears take a step in the door as Banknifty falls on Wednesday!

The Banknifty ended it's five days winning streak on Wednesday as it closed down by 0.26%. Though it has formed lower high and lower candle as compared to its prior trading session, but still it trades within the Monday range for the second day.  

The index has formed a lower low and lower high candle and closed negatively after five days.The volumes were recorded lower than the previous day. 

Talking about the moving averages, the index is trading above the 20, 100 and 200DMA. Interestingly, the 20DMA is in uptrend. Meanwhile, the Stochastic oscillator has given a bearish signal and is seen declining from an extremely overbought condition. The CCI shows the swing high is in place. The index may consolidate for another two days in the range. The Elder impulse system has formed two consecutive neutral bars. Though the bullish momentum has declined, the index has not given a weaker signal. Another two days of negative closing will give reversal signals. The the level of 41799 is likely to act as an immediate support, followed by the level of 41661, which is the breakout level. The RSI is in an overbought condition, and a close below 60 will be negative for the index. For now, stay neutral and apply rangebound strategies.

Strategy for the day 

The Banknifty ended Wednesday's session on negative note and it formed a lower high and lower low as compared to its prior trading session, but it's still within the mother bar of Monday

Going ahead a move above the level of 42200 is positive for the index, and it can test the level of 42380 on the upside. Maintain a stop loss at the level of 42114 for long positions. Above the level of 42380, continue with a trailing stop loss for higher targets. But, a move below the level of 42114 is negative, and it can test the level of 41980 on the downside. Maintain a stop loss at 42200. Below 41980, continue with a trailing stoploss.