Assuming the fast slide on bank nifty over the past couple of weeks to be the primary trend, I conclude this to be a slower retracement towards 61.8 percent of fibs, a buy from the given levels would be recommended; with an aggressive stop at the red mark
Bank Nifty may be attempting a breakout from a downward sloping trendline. A good low cost option to play this can be by executing a call butterfly for 25 July expiry:
Buy +1 Call 31000 Strike
Sell -2 Call 31500 Strike
Buy +1 Call 31600 Strike
Net cost 65-70 points (lot size 20)
Max profit potential on the upside 430-435 points.
Profit above 31600: 330-335...
Nifty has Formed Negative Divergence on Weekly chart and also closed below Monthly Resistance level of 11750. Nifty May Come down to fill the gap near 10700-10680 But entry near 10640-10650 Will provide us good risk reward ratio for 12000 Target.Risk Reward for this trade is 1:3