Bank Nifty Analysis, Outlook and Important levels on All Time Frame Charts

| March 15, 2020

Bank Nifty corrected by more than 38% of its life time move in just 2 months and pattern on long term charts has been changed. So, it is the time of revise wave counts on all time frames again to get idea of further outlook and movement of Bank Nifty.

We prepared last all time frame analysis report of Bank Nifty in 10 Feb 2020 and link to that analysis report is Fresh Elliott Wave Analysis of Bank Nifty on All Time Frame.  Let’s start Elliott Wave Analysis of Bank Nifty with Monthly chart.

Elliott wave counts of Bank Nifty on Monthly chart

Elliott wave counts of Bank Nifty on Monthly chart

This is monthly time bar chart of Bank Nifty covering life time move from low 3314.

It seems wave (1) may be completed at 13303, wave (2) may be completed at 8866 as Irregular Correction and wave (3) may be in progress.

And within wave (3), it seems inner waves (i) may be completed at 20907, wave (ii) may be completed at 13407, wave (iii) may be completed at 32613 and wave (iv) or (v) may be in progress.

Wave (iv) retraced more than its normal 38% retracement [which is placed at 25276]. Even Bank Nifty broke 38% retracement of life time move of Bank Nifty placed at 21420.

So, retracement levels are not applicable now after correcting more than 38% retracement of life time move and we need to concentrate on the pattern of decline started from all time high 32613 to check further possibilities and outlook.

Now, let’s analyze the decline started from all time high 32613 separately on lowest possible time frames to calculate further outlook and levels.

Elliott wave counts of Bank Nifty on 05 Hourly chart

Elliott wave counts of Bank Nifty on 05 Hourly chart

This is 05 hourly time bar chart of Bank Nifty covering decline after all time high 32613 which I am analyzing independently.

It seems wave [a or 1] completed from 32613-30209, wave [b or 2] may be completed from 30209-31649 as big Irregular Correction and wave [c or 3] may be completed at 21351.

23%-38% retracement of progress of wave [c or 3] is placed at 23781-25284 and same is already broken but Bank Nifty didn’t closed above 25284. The downside wave started from 32613 is big, so we need to wait for close above 25284 to confirm breakout.

61% retracement of this whole decline is placed at 28310 in case the decline from 32613-21351 is impulse.

23781-25284 is still short term resistance and 25284 is short term upside breakeven point. Bank Nifty is in short term negative zone as long as trading below 25284. Staying and closed above 25284 can result in further bounce towards 28310-31649-32613.

25284-23781 would be short term support after close above 25284. But risk for decline below 21351 will be there unless Bank Nifty closes above 25284.

Now, we need to analyze the bounce started from low 21351 separately on lowest possible time frame to calculate further levels.

Elliott wave counts of Bank Nifty on 05 Minute chart

Elliott wave counts of Bank Nifty on 05 Minute chart

This is 05 minutes time bar chart of Bank Nifty covering bounce started from low 21351 which I am analyzing independently.

The bounce seems impulsive with inner wave [i],[ii],[iii],[iv] may be completed till 23509 and wave [v] may be in progress.

Wave [v] achieved 61% projection after break above 25488 and is already a extended wave. Next 100% projection is placed at 26712 which is a rare case.

Within wave [v], it seems [1] may be completed at 24255, wave [2] may be completed at 23748, wave [3] may be completed at 25670 wave [4] may be completed at 24269 and wave [5] may be in progress. Wave [4] retraced deeper than 38% but didn’t overlap [1].

61% projection for wave [5] falls below earlier high 25670 and 100% projection is placed at 26430. So, 25670-26430 is minimum target range for completion of wave [5] but break above 26430 is a rare case.

23%-38% retracement of wave [3] is placed at 25216-24935 and same is already broken. Break below 24935 was indicating decline towards 23748-23509 but Bank Nifty decline till 24269 and bounce back above 25216 again.

Now, 25216-24935 is again immediate support and 24935 is immediate downside breakeven point. Bank Nifty is in positive zone as long as trading above 24935 and can bounce towards 25670-26430.

But break and stay below 24935 can result in further decline towards 23748-23509.

Conclusion and Outlook:-

Bank Nifty corrected by more than 38% in last 2 months whereas Friday was most volatile day in Bank Nifty history with lower circuit followed by 15% recovery. These are rare conditions and we still need to wait for stability in market. India VIX is at 50 which mean fear in market is still there. I am suggest the levels and outlook based on wave counts but still there is hesitation and low confidence in levels when market is extremely volatile.

For short/medium term, 23781-25284 is short term resistance and 25284 is short term upside breakeven point. Bank Nifty is in short term negative zone as long as trading below 25284. Whereas Bank Nifty if stay and close above 25284 can result in further reversal towards 28310-31649-32613.

25284-23781 can act as short term support after closing above 25284. But risk for decline below 21351 will be there unless Bank Nifty closes above 25284.

Very Short term/Intraday, 25216-24935 is immediate support and 24935 is immediate downside breakeven point. Bank Nifty is in positive zone as long as trading above 24935 and has possibility to bounce towards 25670-26430.

But break and stay below 24935 for more than 15 minutes can result in further decline towards 23748-23509. 24935-25216 can act as immediate resistance after stay below 24935 for more than 15 minutes.

On upside, 26430-26712 is immediate/intraday resistance. Bank Nifty can decline towards 24269-23509 before breaking higher above 26712. We need to check pattern again if Bank Nifty breaks straightway above 26712.

We need to keep all these conditions in mind while deciding next trade.

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Trading Strategy:

Last trading sessions was most volatile session of Bank Nifty history and market is still not stable yet. Our levels and trading strategies are based on normal conditions which we prepared after long back testing but there is hesitation and low confidence if these levels are going to work in such rare market conditions because there is no way to back test strategies for these type of rare market events.

Personally we are not trading with stoploss and we are doing only hedged option trades in minimum possible quantity. On Friday, bid difference was so huge that even hedged trade was risky because we could lose points at the time of initiating trades only. We personally like to trade safe and avoiding trades in such condition but we are still suggesting most probable and low risk trading strategies. Traders who want to take risk or can manage trades can use these levels and conditions to plan their own trade.

Positional, Bank Nifty if stay above 25284 for couple of hour then positional trading strategy would be Buying on Dips with stoploss some points below 23781 for upside targets 28310-31649-32613 in coming days. 25284-23781 will be low risk buying range after fulfilling of condition.

For Intraday,

  1. Selling can be done if get in 26430-26712 range with stoploss above 26800 expecting decline towards 24269-23509.
  2. Bank Nifty if breaks and stay below 24935 for more than 15 minutes then later bounce towards 24935-25216 can be used to sell Bank Nifty with stoploss some points above 25216 for downside targets 23748-23509.

Further, we will update about the formation of any important internal pattern or any change in trend/pattern/important levels or fresh support/resistance/breakeven point during market hours by WhatsApp Broadcast to all my “Bank Nifty Live Updates” subscribers.

Get Bank Nifty and Bank Nifty Daily Analysis Reports and Live Updates on WhatsApp for Free.

Click Here to know more.

DisclaimerThis analysis report is just for outlook, probabilities and expected markets behaviour based on my personal Elliott Wave Analysis. Any trade based on these reports is solely your decision. I will not be responsible for any trade, loss or profit.

 

 

                                                               

 

                                                                                                                                                 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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