Elliott Wave Analysis Report of Bank Nifty for 23 May 2017

| May 23, 2017 | 2 Comments

Bank Nifty again opened higher at 22874 and registers day’s high 22918 but didn’t sustain at those level and decline back by more than 270 points from high to register day’s low 22637 and finally closed 116 points down at 22652.

Yesterday, I expected Bank Nifty to bounce above all time high 22978 again in near term and Bank Nifty can decline back only if pattern of decline turn into complex correction. I also suggested to buy Bank Nifty with stoploss of 22745 for minimum targets 22902-22978, but avoid the trade if Bank Nifty already bounce straightway near 22902. Bank Nifty achieved 22902 at opening only so trade was negated. Let’s analyze fresh charts to calculate next move.

This report is covering Bank Nifty move after 9 Feb 2017 low 20003 and earlier wave and is further update on my last analysis report Elliott Wave Analysis of Bank Nifty on all time Frames Dated 03 April 2017

Elliott wave counts of Bank Nifty on 5 Hourly chart

Elliott wave counts of Bank Nifty on 5 Hourly chart

This is 5 hourly chart of Bank Nifty showing bounce from 20003 which is start of wave (V) on previous chart.  This is the same chart with explanation which I had explained in my last report because wave counts are almost same.

It seems an impulse is completed from 20003-22978 as shown on chart. Inner wave (3) of this impulse is tricky and slower and wave (5) is faster and highly extended which projected more than 61%. These are the most probable count at this point of time.

23%-38% retracement of this whole wave (from 20003-22978) is at 22275-21840 which is the expected targets range on downside if impulse is already completed at 22978 and correction is already started.

Now we need to analyze the progress of wave (5) started from 21386 on separate Hourly chart to check the pattern.

Elliott wave counts of Bank Nifty on Hourly Chart

                       Elliott wave counts of Bank Nifty on Hourly Chart

This is Hourly  chart of Bank Nifty showing bounce from 21 Apr 2107 low 21386 which is the start of wave (5) shown on previous chart.

Wave 3 seems completed at 22491, wave 4 may be completed at 22241 and wave 5 may be completed at 22978 as shown on chart.

23%-38% retracement of this whole wave (5) (from 21386-22978) is at 22602-22369 which is the expected targets range on downside if the correction started. Bank Nifty achieved 22628 till now.

But if we look at the pattern of decline from all time high 22978 then a (abc) correction seems completed or progressing as Complex Correction. So, let’s have a look at pattern of decline from all time high 22978 for confirmation and to calculate very short term move.

Elliott wave counts of Bank Nifty on 15 Min chart

Elliott wave counts of Bank Nifty on 15 Min chart

This is 15 Min chart of Bank Nifty covering move from all time high 22978.

It seems an (abc) cycle is already completed from 22978-22628 but next bounce after low 22628 also looks like corrective wave followed by a corrective decline again. So, the whole decline from 22978 may be forming a complex correction (Double Zigzag or Triple Zigzag).

Normal 100%-123 projection of first (abc) cycle [from 22978-22628] is at 22568-22485 which we can assume as edge to initiate any low risk trade.

Otherwise, it is almost impossible to calculate exact levels and stop loss when Complex Correction is running because inner waves of a Complex Correction can take any shape.

Conclusion and Outlook:

The decline from all time high 22978 is forming some type of complex correction or making a setup for big move again. And it is almost impossible to calculate exact levels and stoploss during the progress of complex correction because inner waves of Complex Correction can take any shape.

So, we need to wait for completion of Complex Correction or some other pattern to form to conclude next further move.

Only 22568-22485 range can be used as edge to initiate trade at this point of time.

For Trading:

We need to wait for completion of Complex Correction or some other pattern to form to initiate any next confident positional trade.

Generally, Bank Nifty if decline towards 22568-22485 then Bank Nifty 25 May 22500 call can be bought in light quantity with stop loss of 22457 (some points below 22485) 22810-22918.

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