Bank Nifty Can Decline Towards 26923 Very Soon

| January 13, 2019

Bank Nifty opened higher at 27602, registered high 27612 but decline back again by more than 200 points to registers day’s low 27382 and finally closed 74 points down at 27453.

Yesterday, decline towards 27161-26923 was expected very soon and 27754-27925 was resistance range.

Trading strategy was to hold Bank Nifty 27200 Put of 17th Jan Expiry bought in 27603-27754 range using stoploss of 27931 expecting decline towards 27161-26923 in coming days. Bank Nifty opened at 27602, decline till 27382 and finally closed at 27453 whereas 27200 put of 17th Jan closed at 88. Now, we need to analyze fresh charts to calculate further move.

This analysis report is covering decline from all time high 28388 which I am expecting as start of inner wave inner [4] of (iii) of bigger (3) in my last analysis report Elliott Wave Outlook and Trading Strategy of Bank Nifty for 08 October 2018 Onward

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 move from all time high 28388 which I am expecting start of inner wave [4] of wave (iii). Wave [4] may be completed from 28388-24240 as Simple Zigzag Correction.

From low, its seems wave completed at 25915 may be wave (i), wave completed at 24353 may be wave (ii), wave (iii) may be completed at 27369, wave (iv) may be completed at 26408 and wave (v) may be completed at 27754 or still in progress.

Wave (v) achieved 38% projection after breaking above 27603 whereas 61% projection is placed at 28341 which may or may not be achieved.

Now, let’s analyze the bounce started from low 26408 on separate lowest time frame chart to check inner counts of wave (v).

Elliott wave counts of Bank Nifty on 30 Minute chart

Elliott wave counts of Bank Nifty on 30 Minute chart

This is 30 Minute time bar chart of Bank Nifty covering move from low 26408 which I am expecting start of wave (v) on the previous chart.

It seems wave completed at 26517 may be wave [1], wave completed at 26460 may be wave [2], wave [3] may be completed at 27239, wave [4] may be completed at 26923 as irregular Correction and wave [5] may be completed at 27754.

Wave [5] achieved 100% projection which is placed at 27754 and becomes highly extended wave. Wave [5] started from 26923 and inner wave 5 of [5] started from 27161 is extended, so there is possibility of sharp decline towards 27161-26923 soon.

Conclusion and Outlook:

Same, there is no major change in outlook, Bank Nifty charts are indicating that the impulse started from low 24240 may be already completed at 27754 because this impulse already achieved it all minimum requirement, even very last inner waves (wave [5] & ‘5’) of this impulse are highly extended.

Wave [5] started from 26923 and inner wave ‘5’ of [5] started from 27161 is extended, so there is possibility of sharp decline towards 27161-26923 soon.

On the other hand, there is a possibility of 780-1262 points decline (23%-38% retracement of wave completed from low 24240-27754) from high.

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

Trading Strategy:  

According to fresh conditions on charts: –

There is no change in outlook and trading strategy, possibility of sharp decline towards 27161-26923 is still there and 27754 can be used as stoploss for shorts. Bank Nifty needs to bounce very sharply above 27754 to negate the possibility of this decline.

So, Bank Nifty 27200 Put of 17th Jan 2019 bought in 27603-27754 range on Tuesday can be hold expecting decline towards 27161-26923 very soon. 27754 is stoploss for shorts but I preferred to hold trade without stoploss for next 2 sessions atleast.

These is low risk trading strategies I can suggest in such conditions, otherwise- traders can plan their own trade based on the conditions explained above.

DisclaimerThis analysis report is just for outlook, probabilities and expected markets behavior 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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Also Read,

  1. Bank Nifty Outlook and Trading Strategy for 07 January 2019
  2. Elliott Wave Outlook of Bank Nifty for 31 December 2018
  3. Elliott Wave Analysis Report of Bank Nifty for 03 December 2018     
  4. Bank Nifty can Decline by 450-700 Points Before 26431
  5. Elliott Wave Outlook and Trading Strategy of Bank Nifty for 15 November 2018 Onward

                                                               

 

                                                                                                                                                  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Category: Bank Nifty

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