Bank Nifty Weekly Chart Analysis

Based on the weekly chart, here's a detailed analysis using various technical tools and strategies:

1. Support and Resistance Levels

  • Support Levels:

    • 48,500: Current key support zone and psychological level.
    • 45,000–46,000: Strong demand zone, as seen in earlier retracements.
    • 41,000–42,000: Long-term support zone from 2021–2022.

  • Resistance Levels:

    • 50,500–51,000: Immediate resistance zone (current consolidation area).
    • 52,500–53,000: Strong resistance at the previous swing high.
    • 55,000: Major psychological and all-time high resistance.

2. Fibonacci Retracement

Considering the major uptrend from the COVID crash low (~16,000 in March 2020) to the peak (~55,000 in 2023):

  • 23.6% Retracement: ~48,300 (current level).
  • 38.2% Retracement: ~42,800 (next key support).
  • 50% Retracement: ~36,000 (major support zone).
  • 61.8% Retracement: ~29,200 (unlikely unless a significant bearish trend emerges).

3. Elliott Wave Analysis

  • The chart indicates a completed 5-wave impulse structure:

    • Wave 1: Rally from ~16,000 to ~37,000.
    • Wave 2: Correction to ~30,000.
    • Wave 3: Strong rally to ~55,000 (extended wave).
    • Wave 4: Consolidation and pullback to ~46,000.
    • Wave 5: Final rally to ~55,000.

  • Currently, it appears to be in an ABC corrective phase:

    • Wave A: Drop from ~55,000 to ~48,000.
    • Wave B: Possible retracement to ~50,500–51,500.
    • Wave C: Likely drop to ~46,000 or lower.

4. Gann Angle Analysis

  • A break below 48,500 suggests the chart is following a bearish Gann angle.
  • If it holds and breaks above 50,500, it may shift to a bullish angle.

5. Pivot Points

  • Key Weekly Pivot Levels (Close: 49,503.50):
    • Pivot Point (P): ~49,550
    • Resistance 1 (R1): ~50,775
    • Resistance 2 (R2): ~52,050
    • Support 1 (S1): ~48,275
    • Support 2 (S2): ~47,050

6. Trendline Analysis

  • A rising trendline from the March 2020 low (~16,000) to the current level (~48,500) acts as long-term support.
  • A descending trendline from the recent high (~55,000) to the current level (~50,500) serves as immediate resistance.

Trading Strategies

Short-Term (Swing Trading) Strategy

  1. Bullish Case:

    • Entry: Above 50,500 (if resistance breaks).
    • Target: 52,500 (first target), 55,000 (second target).
    • Stop Loss: Below 49,500.

  2. Bearish Case:

    • Entry: Below 48,000 (if support breaks).
    • Target: 46,000 (first target), 42,800 (second target).
    • Stop Loss: Above 49,500.

Positional Trading Strategy

  1. Wait for a retracement to 50,500–51,500 (Wave B) to enter short positions.
  2. Target: ~46,000 (Wave C completion).
  3. Stop Loss: Above 53,000.

Risk Management

  • Allocate no more than 2–3% of capital per trade.
  • Use trailing stops to lock in profits during trending moves.

Conclusion

The Bank Nifty weekly chart suggests a corrective phase, with key levels at 48,500 (support) and 50,500 (resistance). A break in either direction will determine the next major trend. Use Fibonacci levels, trendlines, and pivot points for confirmation and better trade execution.

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