What is the Relation Between the Bank Nifty and Nifty Charts?

Bank Nifty & Nifty Charts (1)

Bank Nifty and Nifty Charts:

Nifty charts will give the life of a nifty bank in trading. IT is an index representing 12 of the big capitalized banking stocks trading on the National Stock Exchange.

Nifty is an index representing the NSE‘s 50 most liquid and big-cap stocks. On the other side, bank nifty has only bank stocks listed under it, nifty has stocks listed under it from a range of industries such as banks, automobiles, pharmaceuticals, etc.

In the National stock exchange market, Bank nifty and Nifty charts are always interpreted jointly in the stock market to take both moving averages and positional trades. When technical analysis is engaged in the share trading industry, both charts need to be considered to be able to detect high-prospect trading thoughts.

This elevated level of connection shows that all the time the Nifty trend and the bank nifty will be the same. Traders use this information to evaluate each other’s graphs. At the time when one of the charts is not visible, they can change to the other chart to see the index trend and movement. The nifty bank has a beta of 1.2. Beta measures any stock or index’s volatility. Compared to the nifty, this value. A beta value of 1.2 indicates the bank nifty will always move ahead of the nifty. If you get an obvious signal by the nifty index of the subsequent bank.

Bank Nifty and Nifty Positional Trading Strategy:

Bank Nifty Chart:

chart 2

Nifty Chart:

chart 1

Nifty and BankNifty futures contracts are the most favourite future contract of the positional traders. In positional trading, one holds stocks for a few days or weeks. I have developed this positional Trading Strategy Using Supertrend. In this strategy, we will use the Supertrend indicator along with moving average Convergence Divergence (MACD). MACD will help us to reduce the false signals generated by SuperTrend.  So let’s check the strategy

Set the Super Trend:

    • We will use the default setting(7,3).
    • You want a faster signal, you can change super trend-setting 7,1.5 but it will also generate a lot of signals. 

Set the Mac:

    • We will use the default setting for MACD, i.e 12,26,9 and Timeframe for Chart is 30Min.
    • After the settings up the indicator, we will check when to take entry and when to exit.

Buy Signal:

    • When SuperTrend shows Buy signal and MACD is above the Zero line, take the long position in the contract.
    • Ignore the sell signal when MACD is above/overlapping the zero lines and continue your long position until sell criteria are met. 

Sell Signal:

    • When SuperTrend shows Sell signal and MACD is below the Zero line, take the Short position in the contract.
    • Ignore the buy signal when MACD is below/overlapping the Zero line and continue your Short position.
    • You need to strictly follow the MACD position as I mentioned above to reduce the false signal by Super Trend. Otherwise, this strategy will be less effective.
    • You can check Buy/Sell Signals in charts to get a better understanding of this Nifty- Bank Nifty Positional Trading Strategy.

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