In our monthly research report, we published about Bank Nifty in July 2024 and predicted a cautious stance in case of a breach of support levels in the upcoming trading sessions. Check out the research we published on 16th July 2024.
Below is the chart which shows a detailed analysis of Bank Nifty which helped to derive support levels of 51700 using Elliott Wave technique. We recommended to trade this index with caution when it was trading near 52400 levels and it breached the support levels in just 4 trading sessions.
Bank Nifty Weekly Chart Anticipated on 16th July 2024
Bank Nifty Daily Chart Anticipated on 16th July 2024
Wave Analysis:
In the month of June, Bank Nifty increased by more than 6% and made a fresh record high near 53180 levels.
On the weekly timeframe, not a single weekly candle has given a close below previous week's low since 10th June which keeps undertone on the positive side. We can see that the prices are trading close to the upper end of the Bollinger Bands®, hence 53300 continues to be key resistance levels. However, since past 2 weeks Index is forming neutral candles suggesting reduction in momentum. As per wave perspective, wave g is still unfolding on the upside.
On daily chart, we can see that since start of July month Bank Nifty has lost its momentum, which is visible in the chart as it continued to trade in a range of 52000-52850. So, a breakout of it is needed to understand further trend. Also, prices seen to be hovering around the mid bands suggesting indecision.
In a nutshell, Bank Nifty is at deciding point. A break above 52850 is must for fresh buying to emerge with the targets of 53300 followed by 54000. Whereas on the downside 52000 followed by 51700 are the key support levels to watch out. A breach below it will be a sight of concern!
Bank Nifty Daily chart (Happened as on 07th August 2024)
Happened: Post recommending a cautionary stance on Bank Nifty, the index completed wave g on the upside and breached the support levels in 4 trading sessions. As expected, the index nosedived -5% post completion of wave g and is currently trading near 49985 levels.
In nutshell, the overall trend remains bearish on Bank Nifty, one can use pullbacks to sell, as long as 51100 remains protected on the upside.
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