Neo wave is the GPS of the market that helps to understand the overall maturity of the trend. Neo wave is a method that is used to identify price pattern and predict market movements. Bank Nifty has been moving precisely as per neo wave counts. Check out this example of how we applied Bollinger Bands® and Neo wave to identify this fall of more than 400 points in Bank Nifty much early before it started.
Bank Nifty moved as anticipated and Bang on!! We achieved both our targets in one trading session. The following research is picked up from the daily “Agni Bank Nifty report”.
Bank Nifty Daily Chart Anticipated as on 08th January 2025
Bank Nifty Hourly Chart: Anticipated as on 08th January, 2025
Wave Analysis anticipated as on 08th January 2025:
Bank nifty failed to sustain above Gann level of 51416 and has shown fall of more than 1900 points from there in just two trading sessions due to worries over Q3 earnings and emerging HMPV infection concerns. In the previous session, Index witnessed relief rise but still protected previous day's high on closing basis which keeps overall tone on the negative side.
Currently, prices are retesting channel after giving a breakdown of it in the previous session. On the daily chart, Bank Nifty looks to be forming topping Head and Shoulder pattern. A break below 49660 can confirm break of the pattern which can result into further more correction in Index. It will be too soon to conclude as of now so taking one step at a time. For now, a break below 49960 is needed for selling to resume. While on the upside 50500 is the nearest resistance. A break above 50500 can result into deeper pullbacks. As per wave perspective, wave e still ongoing on the downside in form of Diametric pattern.
In nutshell, overall trend for Bank Nifty remains on the downside. A break below 49960 is must for fresh selling to emerge with the targets of 49660 followed by 49460. On the upside 50500 is the key Resistance to watch out for!
Trading Strategy for Bank Nifty (Spot): Short positions can be created below 49960 with the targets of 49660 followed by 49460 and stoploss of 50230 levels.
Trade set up for Futures – Futures positions can be initiated as per spot levels given above.
Trade set up for Options buying: Buy Bank Nifty 30th January 50300 PE if Bank Nifty breaks below 49960 levels.
Bank Nifty 15 Mins chart Happened as on 08th January 2025
Happened: As we were bearish on Bank Nifty, the index moved as expected and lost more than 400 points in the matter of 1 trading day and Bang On!! Bank Nifty achieved both our given targets and made a low of 49544 levels in today’s session. We were able to capture this entire fall with the help of Neo wave and simple Price action.
Neo wave works well on stocks as well as on indices. One can easily derive the path ahead by combining it with simple indicators which can lead to surprising results!!
For now, one should avoid catching lows and should use sell on rise approach to ride the trend. On the upside 50250 is the nearest resistance to watch out!
AGNI (index) Research – Get access to daily research reports and advisory calls on Nifty, Bank Nifty, and Finnifty along with charts, and options strategy, Know more
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