The index closed 438 points higher at 50,440 while the Nifty closed 92 points higher at 23,557.
Shares of ICICI Bank, Bandhan Bank and IDFC First Bank closed with gains of 1-4% respectively, while selling was witnessed in PNB, which closed steady but with a negative trend.
Nifty Bank surpassed its immediate resistance at 50,250 and attempted to breach the 50,500 mark. However, profit booking at higher levels limited the upside.
The market trend remains bullish; hence, any dips if any can be used as a buying opportunity for the short term target of 51,000.
Kunal Shah, Senior Technical & Derivative Analyst, LKP Securities said, “The BankNifty index finally managed to break the resistance level of 50,200 and close above it. The bullish momentum is likely to continue, potentially taking the index towards the 51,000 mark.”
“The gap remains very bullish, and a buy approach is recommended with strong support at 49,700 points,” he added.
Nifty Bank, which opened at 50,200 levels, lost gains shortly in morning trade but recouped the losses after hitting a low of 49,900.
The index witnessed strong price action after hitting a low below 50,000. It reclaimed 50,500 in intraday trade but pared gains to close at 50,440.
Bhavik Patel, Senior Research Analyst at Tradebulls Securities said, “Bank Nifty finally broke its immediate resistance of 50,250, which it was unable to do so since June 10. Immediate support is around 50,000 where it has the highest PE OI while 51,000 strike price has the highest CE OI.”
The fall in CE at 50,000 strike price indicates good support for Bank Nifty. Despite the rally in the market, PCR increased from 0.92 to 1.26, which shows that traders are now getting more cautious at the top and are leaning towards PE.
“The momentum oscillator remains in the bullish favour as RSI_14 is showing strength and trading around 59. As mentioned earlier, the current momentum will only come under threat if Bank Nifty trades below 49,500,” Patel said.
“50,500 and 51,000 are high targets for the bulls this week,” he added.
(Disclaimer: The recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
(You can now subscribe to our ETMarkets WhatsApp channel)
