Banknifty - Analysis - Daily Chart

Analysis

1. Identifying Support and Resistance Levels

  • Support Levels:
    • Immediate support: ~48,000 (recent lows visible in the chart).
    • Next strong support: ~47,200 (previous consolidation zone before breakout).
  • Resistance Levels:
    • Immediate resistance: ~49,200 (recent pivot highs visible).
    • Next resistance: ~50,500 (psychological level + prior significant swing high).

2. Elliott Wave Theory

  • The chart appears to be in a corrective wave structure, likely part of a Wave 4 or beginning of Wave C.
  • Wave Formation:
    • Recent downtrend aligns with a corrective phase.
    • If this is Wave 4, expect a potential upward move (Wave 5) targeting the prior high (~53,000).
    • If it’s a continuation of Wave C, further downside is possible, with 47,000 as a key target.

3. Fibonacci Ratios

  • Fibonacci Retracement:

    • Drawn from the swing high (53,000) to the swing low (48,000):
      • 38.2% retracement: ~49,300 (potential resistance).
      • 50% retracement: ~50,000 (key psychological level).
      • 61.8% retracement: ~50,700 (major resistance zone).
  • Fibonacci Extensions:

    • Downside targets: 1.272 (~47,200), 1.618 (~46,500).

4. Gann Angles

  • Gann angles drawn from the recent high (~53,000) suggest:
    • Dynamic support near 47,800.
    • Resistance aligned near 49,200.

5. Pivot Points

  • Based on recent price action:
    • Pivot point: ~48,600.
    • Resistance levels: ~49,200 (R1), ~50,000 (R2).
    • Support levels: ~48,000 (S1), ~47,200 (S2).

6. Trendlines

  • Downtrend clearly visible with lower highs and lower lows.
  • A break above the downward-sloping trendline near 49,000 could signal bullish momentum.

Trading Strategy

Bullish Scenario (Trend Reversal):

  • Entry: Above 49,200 (confirmation of trendline breakout and above resistance).
  • Target 1: 50,000 (50% Fibonacci retracement).
  • Target 2: 50,700 (61.8% Fibonacci retracement).
  • Stop Loss: 48,500 (below immediate support).

Bearish Scenario (Continuation of Downtrend):

  • Entry: Below 48,000 (break of support level).
  • Target 1: 47,200 (previous swing low + Fibonacci extension).
  • Target 2: 46,500 (Fibonacci 1.618 extension).
  • Stop Loss: 48,600 (above pivot point).


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