Bank Nifty Outlook and Trading Strategy for 20 Aug 2019 – Elliott Wave Analysis

| August 20, 2019

Bank Nifty opened higher at 28331, bounced further to register day high 28468 but declined back again by more than 300 points to register low 28146 and finally closed 30 points down at 28186.

Yesterday, 28125-28048 was immediate support and 28048 was immediate downside breakeven point. Bank Nifty was expected to decline further towards 27683-27534 in coming sessions if breaks and trades below 28048 for 15 minutes. Otherwise, further bounce above 28251 was possible as long as Bank Nifty trading above 28048.

Trading strategy was to Sell Bank Nifty if stay below 28048 for 15 minutes using stoploss of 28161 for minimum downside target 27683. But Bank Nifty opened at 28331 and bounced further till 28469 and whole scenario was changed. Later, further updates with fresh outlook and fresh levels were sent through WhatsApp Broadcast. Now, we need to analyze fresh charts to calculate further move.

This analysis report is covering all time move of Bank Nifty from life time low 3314. We are going to analyze life time move of Bank Nifty using all required time frames. First we need to start from monthly chart.

Elliott Wave Analysis of Bank Nifty on Monthly Chart

Elliott Wave Analysis of Bank Nifty on Monthly Chart

This is monthly time bar chart of Bank Nifty covering bounce after life time low 3314 which is the start of major wave cycle. This is the same chart with explanation which I had explained in last report because there is no change in wave counts on this chart.

It seems major wave (1) completed from 3314-13303, (2) completed from 13303-8866 as Irregular Correction and wave (3) may be in progress.

Within major wave (3), it seems inner wave (i) completed from 8866-20907, (ii) may be completed from 20907-13407and wave (iii) may be completed from 13407-31783 or still in progress.

23%-38% retracement of progress of wave (iii) is placed at 27446-24763. So, 27446-24763 is major support and 24763 is major downside breakeven point. Bank Nifty is in long term positive zone as long as trading above 24763. Nifty already entered in major support 27446-24763.

Within wave (iii), it seems inner wave [1] completed from 13407-20575, [2] may be completed from 20575-17606, [3] may be completed from 17606-27652, [4] may be completed from 27652-24240 as Irregular Correction and [5] may be completed from 24240-31783 or still in progress.

Or may be wave [4] is still in progress as big Irregular Correction. We need to analyze the decline started from all time high 31783 on lowest possible time frame to check its pattern.

Elliott Wave Analysis of Bank Nifty on Monthly Chart

Elliott Wave Analysis of Bank Nifty on Monthly Chart

This is 05 hourly time bar chart of Bank Nifty covering decline from all time high 31783 which I am analyzing independently.

It seems wave completed from 31783-30623 may be wave (A or 1), wave completed at 31699 may be wave (B or 2) as Irregular Correction and wave (C or 3) may be in progress.

Within wave (C or 3), It seems wave (i) may be completed at 30346, wave (ii) may be completed at 30870, wave (iii) may be completed at 27392, wave (iv) may be completed at 28602 and wave (v) may be in progress.

Minimum 38%-61% projection for wave (v) is placed at 26971-25964 which is the minimum target range for completion of wave (v) if wave completed at 28602 is really wave (iv).

Now, we need to analyze the progress of wave (v) started from 28602 on lowest possible time frame to check its pattern.

Elliott Wave Analysis of Bank Nifty on 15 Minute Chart

Elliott Wave Analysis of Bank Nifty on 15 Minute Chart

This is 15 minute time bar chart of Bank Nifty covering decline from 28602 which I marked as start of wave (v) on 05 hourly chart.

Wave completed from 27392-28602 seems corrective (abc) wave which I marked as wave (iv) and wave (v) may be in progress from 28602.

Within wave (v), It seems wave completed from 28602-27683 may be wave [A or 1], wave [B or 2] may be completed at 28468 and wave [C or 3] may be in progress from 28468.

38% retracement of progress wave (c) of wave [B or 2] is placed at 28183 which is immediate downside breakeven point and same is already broken. So there is possibility for further decline towards 27683-27392 in coming sessions.

On upside, 28270 is immediate upside breakeven point and same can be used as stoploss for any existing as well as fresh shorts.

Conclusion and Outlook:-

For long term, Bank Nifty is in positive zone with 27446-24763 as major support. But this is a big support range and is not suitable for trading, so we will concentrate on Support/Resistance based on internal patterns.

For Intraday/Very Short Term, immediate downside breakeven point 28183 is already broken. So there is possibility for further decline towards 27683-27392 in coming sessions. 28183-28270 is immediate resistnace and stoploss can be placed some points above 28270.

We need to check the pattern again If Bank Nifty breaks and stay above 28270.

Trading Strategy:

Short Term Trading strategy would be to “Sell on Rise” whenever getting opportunity as long as Bank Nifty trading below 28602.

Very short term/Intraday, Bank Nifty can be sold in 28183-28270 range using exact stoploss of 28301 expecting decline towards 27683-27392 in coming days. Any existing shorts and Puts can also be hold with same stoploss of 28301 for same targets.

Otherwise, Bank Nifty if breaks and trades above 28270 for 15 minutes then we need to check pattern again. So, if will observe Bank Nifty in live market hours and update accordingly during live market hours to “Live Update Subscribers”.

Further, any change in trend, or pattern or important levels or fresh support/resistance/breakeven point will be updated during market hours through WhatsApp Broadcast.

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Category: Bank Nifty

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