Elliott Wave Outlook and Trading Strategy of Bank Nifty for 23 May 2018 Onward

| May 23, 2018 | 0 Comments

Bank Nifty opened higher at 25780, further bounced to register day’s high 26945 but didn’t sustain at that level and decline back again by more than 200 points to register day’s low 25701 and finally closed 26 point up at 25777.

Yesterday, I had mentioned that Bank Nifty was still in negative zone with 25913 as immediate upside resistance. There was no sign of reversal at bottom, so we can think of any small/big upside bounce after breaking above short term breakeven point 25913 only and same 25913 can be used as stoploss for shorts.

I suggtested light intraday longs can be initiated near 25568 using stoploss of 25499 or light intraday shorts can be taken if get Bank Nifty near 25913 using stoploss of 25971. Bank Nifty opened at 25780 and bounced till 25945 to activate shorts and declined back again by more than 200 points to register low 25701 [gave almost 240 points profit] and finally close at 25777. Now, we need to analyze fresh charts to calculate further move.

This analysis report is covering bounce from 17606 which I am expecting as start of inner wave [3] in my last all time frames analysis report Elliott Wave Analysis of Bank Nifty on all time Frame charts Dated 01 April 2018

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 which I am expecting as start of wave [3] on the previous chart. 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 wave [i],[ii],[iii], may be completed till 25198 and wave [iv] may still be in progress as Irregular Correction with inner wave (A) at 23611, Irregular (B) completed at 27652 and (C) may be in progress from 27652. Minimum 61% projection for wave (C) is already achieved and normally wave (C) of Irregular Correction completes near the end of wave (A).

End of wave (A) is 23611 and 38% retracement of wave [iii] is 22298. So, 23611-22298 is the expected range where wave (C) can complete followed by sharp bounce for new high. Wave (C) already entered in 23611-22298 range.

Now, we need to analyze the progress of wave (C) started from 27652 to calculated its end which will be the bottom of this downtrend. Wave (C) must complete as Impulse.

Elliott wave counts of Bank Nifty on 5 Hourly chart

Elliott wave counts of Bank Nifty on 5 Hourly chart

This is 5 Hourly time bar chart of Bank Nifty covering decline from 27652 which I had marked as start of inner wave (C) of Irregular Correction. 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 that the decline started from high 27652 is impulsive with wave 1 completed from 27652-27116, wave 2 may be completed from 27116-27613, wave 3 may be completed from 27613-25023, wave 4 may be completed from 25023-25723 as irregular correction and wave 5 may be completed at 23605. This impulse decline started from 27652 we are expecting as wave (C) of Irregular Correction.

From low 23605, it seems wave completed at 24666 may be wave (A or 1), wave completed at 24087 may be wave (B or 2) and wave (C or 3) may be in progress from 24087.

Within wave (C or 3), it seems wave completed from 24087-25411 may be wave (1), wave completed from 25411-24734 may be wave (2), wave (3) may be completed at 26972 and wave (4) may be in progress.

Wave (4) retraced more than 38% and is very near to maximum limit 25411. So, maybe I am wrong in identifying this pattern.

So, we need to ignore these wave counts for time being and need to concentrate on the decline started from 26972 on separate lowest time frame chart to calculate immediate moves.

Elliott wave counts of Bank Nifty on 15 Min chart

Elliott wave counts of Bank Nifty on 15 Min chart

This is 15 Minute time bar chart of Bank Nifty covering move from high 26972 which I am expecting start of wave (4) of wave (C or 3) on the previous chart.

Within wave (4), it seems wave 1 may be completed at 26855, wave 2 may be completed at 26918, wave 3 may be completed at 26112, wave 4 may be completed at 24428 and wave 5 may be in progress.

Wave 5 achieved its minimum 61% projection placed at 25896 and became extended wave where as 100% projection placed at 25568 which may or may not be achieved. Bank Nifty achieved 25685 till now.

Within wave 5, it seems wave (i) may be completed at 26102, wave (ii) may be completed at 26283, wave (iii) may be completed at 25685 and wave (iv) may be in progress.

Again within wave (iv), it seems wave completed at 25945 may be wave (a or 1), wave completed at 25719 may be wave ( bor 2) and wave (c or 3) may be in progress from 25719.

100%-123% projection for wave (c or 3) is placed at 25961-26022 which is the expected range for completion of wave (c or 3). And Bank Nifty if breaks above 26102 then further bounce towards 26283-26428 can be expected in coming days.

But inner wave 1 of (c or 3) is big, so bounce can be bigger if the counts I marked are correct and Bank Nifty has possibility to bounce even above 26102.

Conclusion and Outlook:

For Medium/Long term, there is possibility of big Irregular Correction at top, so Bank Nifty is still in medium/long term positive zone and there is possibility for new high above 27652 either from present levels or from 23611-22998. This upside rally must be sharp because of Irregular Correction and it is sharp till now. But we still not confirmed if bottom is already made or pending because pattern at bottom is not completely clear.

For short term, Bank Nifty is still in negative zone with 25961-26022 as immediate upside resistance range. But pattern formed at bottom is indicating a reasonable bounce which can break even 26022 and Bank Nifty if breaks above 26102 then we can expect further bounce towards 26283-26428 in coming days.

So, we need to keep all these conditions in mind to plan next trade.

Trading Strategy:

Buy Bank Nifty 25700 call of 24 May expiry in 25777-25719 range with exact stoploss of 25718 expecting target 25945-26022. Keep trailing stoploss at cost when Bank Nifty achieves 26945 and modify it further to 25899 if it achieves 26022. Those who trade in multi lots can book partial profit at first target and keep rest with stoploss at cost.

CLICK HERE to get Elliott Wave Analysis Reports of Bank Nifty Daily by Email with Expected outlook, Targets, Stoploss and Trading Strategies.

Also Read,

  1. Elliott Wave Analysis of Bank Nifty on All Time Frame Charts [ Dated : 01-April-2018 ]
  2. Bank Nifty Can Bounce by 1300-2000 Points After Achieving 24048-23842
  3. Bank Nifty Can Decline Sharply by 1000 Points After Achieving 25009
  4. Elliott Wave Analysis of Bank Nifty for All Time Frames as on 08 January 2018
  5. Bank Nifty can bounce above 25780 sharply in coming days
  6. Elliott Wave Outlook and Trading Strategy of Bank Nifty for 07 December 2017 Onward
  7. Elliott Wave Outlook and Trading Strategy of Bank Nifty for 07 November 2017 Onward
  8. Elliott Wave Targets of Bank Nifty for October 2017 Expiry
  9. Elliott Wave Outlook and Trading Strategy of Bank Nifty for 16 October 2017 Onward
  10.  Bank Nifty can Bounce Above 25198 Again in Medium Term
  11.  Long Term And Short Term Elliott Wave Analysis Report of Bank Nifty for 14 August 2017 Onward
  12. Elliott Wave Outlook and Trading Strategy of Bank Nifty for 27 July 2017 Onward
  13. Bank Nifty Can Bounce Sharply Towards 24437-24704 in Short Term
  14. Elliott Wave Outlook and Trading Strategy of Bank Nifty for 14 July 2017 Onward
  15. Elliott Wave Outlook and Trading Strategy of Bank Nifty for 07 July 2017 Onward
  16. Elliott Wave Analysis Report of Bank Nifty for 28 June 2017
  17. Elliott Wave Outlook and Trading Strategy of Bank Nifty for 23 June 2017 Onward
  18. Bank Nifty can bounce further towards 23464-23587 in Coming Session

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Category: Bank Nifty

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