Bank Nifty: Levels of 30,810-30,630 to act as crucial support

The banking benchmark index-Bank Nifty has opened final trading session of the week with a minor upside gap and marked the high of 31,436.65. Thereafter, it soon pared its morning gain and the index came off about 600 points from the high point of the day and ended below the mark of 30,900, down by 1.27 per cent. The price action formed a three outside down like candlestick pattern.

Along with this bearish formation, the index has also managed to close below its short-term moving averages, i.e. 20-day EMA and 50-day EMA. The leading indicator, 14-period daily RSI is currently quoting at 45.84 and it is trading below its nine-day average. The fast stochastic is also trading below its slow stochastic line.

Talking about the crucial levels to watch out in the coming week, the zone of 31,440-31,650 on the upside will be a major hurdle for the index. While, on the downside, the zone of 30,810-30,630 will be a crucial support for the index as it is the confluence of 50 per cent Fibonacci retracement level of its prior upward move (29,612.55-31,649.45) and 100-day EMA level.

Derivatives data suggests that among Bank Nifty Calls, the 31,500 strike price is the most active call for February 20, 2020 weekly expiry. Whereas, among Bank Nifty Puts, 31,000 strike price is the most active Put for February 20, 2020 weekly expiry. For February 20, 2020 weekly series, the maximum Open Interest (OI) outstanding for Calls were at 31,500 strike price and for the Puts, it were at 30,500 strike price. For February 20, 2020 weekly series, the open interest wise Put-Call Ratio (PCR) is at 0.53 and for the monthly expiry, PCR is at 1.01.