Bank Nifty Levels and Trading Strategy for 06 January 2020

| January 4, 2020

Bank Nifty opened lower at 32326, declined further by more than 300 points to register low 31960 and finally closed 374 points down at 32069.

Friday, 32369-32311 was immediate support range and 32311 was immediate downside breakeven point. Bank Nifty was expected to decline towards 32134-31995 if breaks and stay below 32311 for more than 15 minute but 31995 was also short term support.

Trading strategy was to sell Bank Nifty in 32311-32369 range after break and stay below 32311 for 15 minute using stoploss some points above 32311 expecting minimum target 32134-31995. Bank Nifty traded below 32311 for 15 minute and declined further till 31960 and also took support around 31995 and bounced back by 100 points. Now, let’s have a fresh look at latest charts for further scenario.

This analysis report is covering very last bounce started from low 24240 which I am expecting as inner wave [4] or [5] of (iii) of bigger (3) in my last analysis report Fresh Elliott Wave Analysis of Bank Nifty on All Time Frame

Elliott wave counts of Bank Nifty on Daily chart

Elliott wave counts of Bank Nifty on Daily chart

This is Daily time bar chart of Bank Nifty covering bounce after 24240. There is no major change in wave counts on this chart. Earlier we had two possibilities but possibility of Irregular Correction is almost negated, possibility of ED is most probable now.

So, (abc) wave completed from 24240-31783 can be inner wave (1) of ED, and wave (2) of ED may be completed from 31783-26560 as Simple Zigzag or still in progress as Complex Correction. We need to concentrate on bounce after 26560 to check its pattern.

From low 26560, wave completed from 26560-30801 can be marked as wave (a or 1), decline from 30801-27568 can be marked as wave (b or 2) and wave (c or 3) may be in progress.

Within wave (c or 3), it seems inner wave (iii) completed at 32157, (iv) may be completed at 30996 and wave (v) may be in progress. 38%-61% projection for wave (v) is placed at 32748-33832 which is minimum target range for completion of wave (v).

Now, let’s analyze the bounce started from low 30996 on separate lowest possible time frame.

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 30996 which I marked as start of inner wave (v) of (c or 3).

It seems inner waves [1],[2],[3] may be completed till 32502, wave [4] may be completed at 31963 and wave [5] may be completed at 32613.

38% retracement of progress of whole wave (v) is placed at 31995 which is already broken once but Bank Nifty didn’t stay/traded below 31995 for 15 minute. So, 31995 is still immediate downside breakeven point.

But Bank Nifty if breaks and stay below 31995 can result in further decline towards short term support range 31073-30404.

Now, let’s analyze the decline started from high 32613 on separate lowest possible time frame.

Elliott wave counts of Bank Nifty on 15 Minute chart

Elliott wave counts of Bank Nifty on 15 Minute chart

This is 15 minute time bar chart of Bank Nifty covering move from high 32613 which I analyzing independently.

It seems wave (a or 1) may be completed at 32254, wave (b or 2) may be completed at 32465 as Irregular correction and wave (c or 3) may be completed at 31960 or still in progress.

23%-38% retracement of progress of wave (c or 3) is placed at 32079-32152 which is immediate resistance range with 32152 as immediate upside breakeven point. Bank Nifty is in negative zone as long as trading below 32152 but it if breaks and stay above 32152 for 15 minutes can result in further bounce towards 32465-32613.

Conclusion and Outlook:-

For short term, Bank Nifty is in positive zone with 31073-30404 as short term support range and 30404 is short term downside breakeven point. It has possibility to bounce towards 32748-33832 as long as trading above 30404. We can think of any big fall after breaks below 30404 only.

For Intraday/very short term, 32079-32152 is immediate resistance range and 32152 is immediate upside breakeven point. Bank Nifty if breaks and stay above 32152 for 15 minutes can result in further bounce towards 32465-32613.

On downside, 31995 is immediate downside breakeven point and Bank Nifty if breaks and stay below 31995 for 15 minute can result in further decline towards short term support range 31073-30404.

Trading Strategy:

  1. Bank Nifty if breaks and stay above 32152 for more than 15 minutes then later decline towards 32152-32079 can be used to buy Bank Nifty with stoploss some points below 32079 expecting bounce towards 32465-32613-32748 in coming session.
  2. Bank Nifty if breaks and stay below 31995 for more than 15 minutes then short term strategy will be “Sell on Rise” with stoploss some points above 32232 expecting decline towards 31073-30404 in coming days/session.

Any other intraday trade for small swings can be planned during live market hours and same will be updated through Live Updates.

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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Category: Bank Nifty

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