The Inside Bar candle was formed by the Nifty Bank on the weekly chart. The banking index closed the week above the 50 day EMA, but was unable to cross the 20 day EMA. The index had a high of 42,715. During the week, 65 were held before closing at 42,506. On Friday, there was 80. It rose by 0.31 per cent for the week.
The immediate support range for the banking index has shifted to 41,500 -- 41,300, while a key resistance is placed at 43,600 level.
A momentum indicator RSI inclined on the positive side. HDFC Bank traded with higher-high formation and has positive momentum, and should perform well in the coming days, as it has a positive momentum among private banks. The Bank of Baroda has bounced back from the support level and can perform well, as it is trading above the 50 day EMA.
Nifty Bank traded in a narrow range of 41,500 -- 43,600 levels for the last five weeks. We can see a buying from lower levels going forward. The last two weeks, the Nifty Bank has managed to close above the 42,300 level. We saw a Doji formation on the weekly chart, which indicates uncertainty about the trend. Nifty Bank can move towards its all-time highs once it crosses and maintains above the initial barrier of 43,500 -- 43,600.
42,000 have the highest open interest OI concentration, which may act as a support for the current expiry of the Nifty Bank Put options OI distribution. Nifty Bank Call strike of 43,000 witnessed significant OI concentrations and may act as resistance for the current expiry.
The bears wouldn't be in command until the 43,500 level is taken out, as the index has had a lot of resistance around this level over the past five weeks. The main trend seems to have run its course.