Bank Nifty is one of the popular indexes in the Indian stock market. How do you predict the gap up or gap down of Bank Nifty? This is a very vital question for intraday traders. No one can correctly predict 100% correctly the gap up or down of bank nifty. The gap defines the price changes.
- The word GAP means the distance between some thing. Here in stock market the gap up or down means that the gap between two consecutive day’s open and close prices.
- A gap up happens when the next day’s price opens with a high from the previous day’s high price. Suppose on previous day bank nifty closes with a high of 38500 and the next day it opens at 38600, then the gap up will be 100 points. If you see the chart then you can see that a new level will be marked at the higher level when the market open.
- Similarly, a gap down occurs when the next day’s market price opens with a lower price than the previous day’s lowest price. If on the previous day bank nifty closes with a low of 38500 and the next day it opens with 38400, then the gap down points will be 100 points. The low price will be seen when the chart bar open’s in the red colored bar at a low level. This seems the gap down.
- To trade in Bank Nifty you need a Demat account. Open a Demat account click here to get the best discount broker.
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Predict the Gap Up or Gap Down of Bank Nifty
- To predict the bank’s nifty movement is near impossible. What will happen in the next trading session no one can’t predict 100%. Because the bank’s nifty movement is so volatile. Due to its volatile nature, it’s very risky to trade in it and also difficult to predict the movement.
- To predict the bank nifty movement you can analyze the chart pattern. As we have analyzed the last 5 years’ chart pattern and from that experience writing this article.
- In the charts, you can see the bars and candles that market on its movement. As bank nifty movement has unpredictability, when it creates gaps it will fill the gaps within some days. It certainly has not happened that the market hasn’t filled the gap. So it is important to identify the candle or bar patterns. Then you can predict with the historical data analysis how will it move.
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Predict Bank Nifty Movement
- Using the chart pattern you can analyze the range of bank nifty movement. If you see that bank nifty doesn’t move in any direction and stack into a range, then analyze the previous week’s chart and see if it is staying inside that range or not. That indicates it is not breaking either the high or low range. Then you can take any position between these levels and set your target. We can advise in this situation not to wait for a big movement.
- Since we are analyzing the charts, the market moves in a range bound, it goes too much noise. If the market stays inside the levels of the previous week’s range then a big break out can be seen in the coming next week. Wait for that moment and then take a position for long term and big move. If the prediction goes correct this will bring you a big profit.
As we already trading on bank nifty is very risky. Many investors got trapped in this hype. The bank nifty movement goes in volatile character. We will advise never jump into the gap moment, this trend can be break at any time. That will take you to the worst position. We will recommend to wait while the gaps get filled. Then analyze the trend and take your position as you choose.
If you wish to earn profit in intraday then always take the short time position and make a small target. This consistence will make profitable in regular basis.
THANK YOU and Wish You Safe Trading
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How do you predict Bank Nifty trend?
1. High rate of Call and Put option open interest
2. Short-term positions
3. High Call and Put OI of HDFC Bank, Axis Bank, Kotak Bank, ICICI Bank
4. Put Call Ratio OI trend, indicates the Bullish market. Also applies to the Bearish market
5. Index 4 percentile, below 30 and above 90
6. Cost of carrying movement, high discount, high premium means range bound expectation.
7. Expiry day.
8.Exponential Moving Average(EMA), 20,30,40,50,100,200 and 300
Read more: Predict Bank Nifty trend
How do you know if Bank Nifty is up or down?
To know the Bank nifty up or down movement, follow the market trend. Analyze the daily chart pattern and predict the daily moving average. This can help you to understand bank nifty movement. If the market opens in green bars that means it opens with gap up and if opens in red bar then it opens with gap down.