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
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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.
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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
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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.
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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
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Bullish Case:
- Entry: Above 50,500 (if resistance breaks).
- Target: 52,500 (first target), 55,000 (second target).
- Stop Loss: Below 49,500.
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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
- Wait for a retracement to 50,500–51,500 (Wave B) to enter short positions.
- Target: ~46,000 (Wave C completion).
- 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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