On the weekly time frame, after registering high of 28,388.65 in the last week of August, 2018, the banking benchmark index
Bank Nifty witnessed a sharp correction of almost 14.5 per cent; however, the price took support around the lower end of the channel, which was plotted by joining lows which were seen in the month of March 2018.
The index bounced back from the lower end of the channel, however, it faced resistance at
38.2 per cent retracement level of the last leg of decline which started from level of 28,388.65 to the low of 24,240 and its
52-week SMA. Going ahead, the banking index has strong support in the region of 24,250-24,630 as it is a confluence of 78.6 per cent retracement of the entire upmove from March to August, i.e. from 23,605 to 28,388.65 and the lower end of the channel is placed in this region. On the upside, Bank Nifty needs to get past the immediate resistance level of 25,350-25,400 and moving past this zone would probably open up for further upside up to the levels of 25,830-25,930 as it is the confluence of 38.2 per cent retracement of the last of decline (28,388.65- 24,240) and the 52-week SMA. The 14-period RSI on the daily chart is quoting around the 50 mark and it has recently marked a fresh 14-period high, which is bullish. The daily MACD is trading above its signal line.