M pattern in the Banknifty

The BNF movement for monthly expiry has shown a significant gap up, followed by a swing of more than 700 points, bringing it to the lowest point. Interestingly, at the top, BNF is forming the M pattern, indicating a potential reversal in the near future. Based on this pattern, it is anticipated that if BNF breaks the 45650 level, there could be a substantial downward movement.

Currently, there is selling pressure present in the market, indicating a downward trend. However, the Bank Nifty (BNF) is finding support at the 50% Fibonacci retracement level. It is important to note that a significant resistance level lies at 46300, which needs to be surpassed for a longer-term bullish outlook. To confirm a bullish trend, the BNF must successfully break above 46300 and maintain this level with the support of a daily candle.

If the market gaps down or opens flat tomorrow, there is a possibility of selling pressure. However, sharp selling would only occur if the market falls below 45600, with a downside target of 45458. On the other hand, if there is a gap up in the market, short covering may occur, leading to a retest of the 46000 level. It is important to note that the immediate resistance level stands at 45868.