Thu Oct 31 01:00:00 UTC 2024: ## Indian Stock Market Flat Despite Recent Rally, Bank Nifty Sees Resistance at 52,000
**Mumbai, October 25, 2023:** The Indian stock market benchmarks, Sensex and Nifty 50, traded flat with a negative bias on Wednesday, following a strong pullback rally in the previous two sessions. Bank Nifty, which witnessed a sharp 2% surge on Tuesday, was down by half a percent today.
The Bank Nifty index traded near the crucial level of 52,000, considered a significant resistance level by analysts. “The Bank Nifty index has made a strong move towards the crucial resistance level of 52,000, a level which needs to be sustained for confirming a continued bullish momentum for weekly close,” said Ganesh Dongre, Senior Manager, Technical Research, Anand Rathi. “The index needs to stay above the 52,000 resistance zone on closing basis, a slip below 52,000 will suggest a shift towards bearish sentiment which can prompt traders to exercise caution.”
Dongre also pointed out that the next key resistance points for Bank Nifty are in the range of 53,000 – 53,500, while the crucial support is currently located at 50,500.
As the market gears up for the festive season, investors are keeping a close eye on trading strategies for the annual Diwali Muhurat trading session, a one-hour event considered an auspicious time to trade.
Dongre suggested a low-risk Bank Nifty options trading strategy for the Muhurat trading session, applicable if the index closes above the crucial 52,000 level. The strategy involves buying 1 lot of 52,400 CE with October 30 expiry at CMP 136 and selling 1 lot of 52,600 CE with October 30 expiry at CMP 81.
The required capital for this trade is Rs. 20,000. Dongre stated that the maximum profit from this trade would be Rs. 2,190, while the maximum loss would be Rs. 810. The break-even point is above 52,450, with profit booking recommended near the 53,000 resistance level. This strategy offers a limited risk of Rs. 810 per lot.
It is important to note that this Bank Nifty trading strategy is only effective if the Bank Nifty closes above the 52,000 level. Investors are advised to consult certified experts before making any investment decisions.
**Disclaimer:** The views and suggestions above are those of individual analysts or broking firms and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
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