Bank Nifty Update - Elliott Wave India

1 Aug 2022

28 July 2022

26 July 2022

22 July 2022

20 July EOD

18 July 2022

14 July EOD

12 July 2022

7 July EOD

6 July 2022

4th July EOD

4 July 2022

1 July 2022

28 June 2022

21 June 2022

16 June 2022

9 June 2022

6 June 2022

3 June 2022

30 May 2022

26 May 2022

Market Comm 23 May

20 May 2022

18 May 2022

16 May 2022

12 May 2022

Bank Nifty Update. As on Mon 1 Aug 2022. CMP 37,600. Posted at 10:30 am.

Bottom line : Trend remains strong. Near term, a correction is due to below 36,700 which would be a bullish opportunity. But strength looking formidable. Playing for the short side is not advised.

Primary count : Price may have completed / be completing a 3rd of 3rd wave. There is major support at the 36,300 ~ 36,500 level, if a correction gets that far.

Intermediate term Bank Nifty is thrusting up from a bullish triangle to new all time highs above 41,827, and potentially 44K ~ 45K.

Alternate count : In case of a bigger decline to the 35,500 level, this count would come into focus, but at this stage it is more a possibility than a probability. This count shows price is still in wave D of a larger bullish triangle.

Bank Nifty Near Term update. As on Thurs 28 July 2022. CMP 37,280.

Yet another gap up open today makes this immediate rally closer to the end than the middle. Bank Nifty has also reached it’s measurement target for the end of the immediate rally, although given the momentum, somewhat further is also possible.

The latest at 36,807 is potentially an exhaustion gap of the recent rally, and is expected to be closed within a week or so.

The intermediate wave count is still bullish.

Bank Nifty Update. As on Tues 26 July 2022. CMP 36,726. Posted pre-market at 9:10 am.

Bottom line : Probability of a larger bearish resolution is now very low. With a 5 wave impulsive rally clearly visible (see alternate 1), the probability of further upside is stronger than downside. The larger bearish count has been virtually discarded and is not shown as an alternate in this post.

Primary count : The angle of rally of each upside wave on the 4 hour / daily chart has only gotten sharper, which strengthens the case this is a 3rd of 3rd wave rally.

In the near term, a temporary consolidation / correction cannot be ruled out as minimum target for 3rd of 3rd has been met at 37,000. Any correction without filling the continuation gap at 35,759 is preferable.

Larger picture - 3 day and weekly charts, Bank Nifty has begun a thrust up from a bullish triangle to new all time highs above 41,827.

Alternate count : Instead of a 3rd of 3rd wave up, there is still a 5 wave impulse from 32,298, which makes a decline below 32,298 extremely improbable. A temporary correction under this count is likely towards 34,500 ~ 35,000, before resuming the upward rally. This count shows the larger bullish triangle still in wave D.

Bank Nifty Update. As on Fri 22 July 2022. CMP 36,700. Posted at 12:50 pm.

Bottom line : 3rd of 3rd advance continues in the near term. End to the immediate rally likely at 37,000 ~ 37,300.

Intermediate term Bank Nifty likely heading to new all time highs above 41,827.

Primary count : 1900 point rally in Bank Nifty this week (so far) shows the power of a 3rd of 3rd advance, and it's not done yet. A temporary pause is likely at about 37,000 ~ 37,300.

Alternate count : This is purely academic. With no supporting evidence of a turn lower, this count technically remains on the table that shows price in wave E of a large bearish triangle.

As shown in the previous post, the slope of the rallies grew sharper with each advance, which only served to emphasise the primary bullish count.

Bank Nifty Update. As on Wed 20 July 2022. CMP 35,972. Posted at 4 pm.

Bottom line : Strength continues. Another gap up open today suggests price is in a 3rd of 3rd wave advance.

Primary count : The labelling shown in the chart is the conservative count. The alt text in blue denotes the aggressive count, which suggests a 3rd of 3rd is in progress.

The gap up at the open is the 2nd such gap in the last 3 days, which suggests it is a continuation gap (after the initial break-away gap on Monday) and is significant.

Continuation gaps are not closed soon, usually not until the intermediate trend has turned lower. So if Bank Nifty closes today's gap at 35,760 soon, it is probably NOT a 3rd of 3rd wave advance and consolidation / correction can be expected.

But given the strength of the move this week, there is reasonable probability it is a continuation gap, and further upside to 37,500 becomes the next target zone for Bank Nifty.

Alternate 1 : Bank Nifty has reached the target zone for wave E of the bearish triangle (see earlier posts 36,100 ~ 36,500). A gap down tomorrow or some other reversal pattern would be the first step towards a trend reversal to the downside.

This is an alternate count for good reason. The angle of each of the advances since the june 17th low has been increasing, which is at odds with a reversal signal.

For now, all evidence points to continuation of the rally.

Bank Nifty update. As on Mon 18 July 2022. CMP 35,358. Posted EOD at 4:20 pm.

Bottom line : At least one more high above 35,541 (likely above 36,000) is required under either counts 1 or 2.

The strength of current price action makes it a reasonable probability that Bank Nifty has begun a thrust up to new all time highs above 41,827.

Count 1 : If price continues showing strength, Bank Nifty is likely in a 3rd wave to the upside, or even a 3rd of 3rd wave to the upside. The 34,134 level cannot be violated under these counts in the near term. If 34,134 is violated, other counts (not shown today, see previous post) would enter the picture.

Count 2 : Short term bullish, intermediate term bearish.

This shows Bank Nifty is completing the final sub-wave up of wave E of a bearish triangle, which should end at 36100 ~ 36,500.

Bank Nifty Update. As on Thurs 14 July 2022. CMP 34,651. Posted at 4:30 pm.

Bottom line : Intermediate term bullish bias remains intact. So far, there is not enough evidence to conclude the larger trend has turned lower. Short term potentially more corrective price action t0 below 34,147.

Counts 1 & 2 can be used interchangeably till the count clarifies.

Count 1 : Bank Nifty in wave D up of a larger bullish triangle on the weekly chart.

On the 3 day chart, BN may have completed wave (a) at 35,541 and could be in a choppy sideways wave (b).

On the Daily chart, if wave (a) is complete at 35,541, (and there is no confirmation it is complete), this is what a sideways correction may look like.

Count 2 : This is the maximalist bullish count, which shows the larger bullish triangle is complete, and price has begun it's trek up to new highs. The short term count demands 34,134 not be violated soon, and preferably also not 34,360, which means an immediate resumption of the uptrend to above 35,541 at least is required.

Count 3 : This bearish count remains valid due to lack of a 5 wave impulsive rally. This shows Bank Nifty has completed a bearish triangle and is in the early stages of a thrust lower to below 30,000. But the decline so far from 35,541, tho' sharp, is not conclusively impulsive. Until further evidence emerges, the above 2 counts are preferred.

Bank Nifty Update. As on Tues 12 July 2022. CMP 35,330. Posted at 10:35 am.

Bottom line : Bullish.

With the bearish probabilities lowered significantly, both primary and alternate 1 show continued rally to at least 38,765.

The larger bearish probability still does exist (alternate 2), but the odds are significantly lower than last week.

Both primary and alternate 1 have equal weightage, and the message is essentially the same.

Primary count : Bank Nifty has completed a large bullish triangle and has begun a large thrust upwards to new highs above 41,827.

On the hourly chart and daily chart, BN appears to be tracing out an initial 5 wave impulse, and is currently in a 3rd wave.

Alternate count 1 : This shows price is still in wave D of the larger bullish triangle to above 38,765. This move could be more choppy than the primary count.

Alternate 2 : Due to lack of a 5 wave impulsive rally, still unable to rule out the bearish triangle. Minimum requirement for wave E has been met, but could go further higher to above 36,000, which is the 61% fibonacci retrace of wave (c).

Bank Nifty Update. As on Thurs 7 July 2022. CMP 34,920. Posted at 5:30 pm.

Bottom line : Neutral. Price action has not yet confirmed the bearish count. In fact, Price has reached the limit for the bearish count. Any further upside could bring the bullish Count 2 into focus.

Count 1 : If an ending diagonal is playing out, it has reached its limit. Any further rally would cause the ending diagonal to be discarded. If the bearish count has to play out, bank nifty has to fall immediately, and rapidly.

Today's daily candle is a large green one, where price has closed literally at the high of the day, which means a good chance of further upside.

Count 2 : This count has serious bullish implications. It calls for new highs where a large wave 4 triangle (on the 3 day chart) is complete, and price has begun a thrust upwards to above 41,827.

On the 1 hour chart, if price accelerates upwards it would mean a strong 3rd of 3rd wave to the upside is underway, and provides an initial target of above 36,000.

Bank Nifty update. As on 6 July 2022. CMP 34,180. Posted at 11:15 am.

Bottom line : Every small twist and turn in the last 24 hours seems to only confirm the bearish view. The probability of bullish views are receding rapidly. Bank Nifty is expected to top out in a few days (end of this week or sometime next week) at about 34,500 ~ 34,800.

Primary count : Ending diagonal on the 30 min / hourly chart is playing out perfectly. Wave 3 is likely in place at 34,360, and price is now headed down in wave 4 (or soon will be) towards 33,500 ~ 33,600. After which a final high in wave 5 at about 34,500 ~ 34,800 would complete the ending diagonal, and thereby complete wave E of the bearish triangle, and set the stage for a rapid decline. For alternate counts, pls see previous posts.

Any strong rally this week would call this wave count into question, but until there is clear evidence of larger time frame bullish behaviour, this count remains preferred.

Bank Nifty short term update. As on Mon 4 July 2022. CMP 33,940. Posted at 4:20 pm.

Bottom line : Clear parameters. A rally above 34,560 early tomorrow would immediately bring the seriously bullish alternate count 2 into focus. If that doesn't happen, then look for an end to this counter-trend rally within a few days.

Primary count (Still intermediate bearish) : Price has followed the smaller bullish triangle perfectly so far. A dip tomorrow / wednesday is Necessarily Required to below 33,593 to complete the small bullish wave X triangle, and subsequent thrust up to 34,700 ~ 35,200 and thereby set the stage for a large decline to below 30,000.

Alternate count 1 (Intermediate bearish) : An ending diagonal could be playing out on the 2 hour chart. If price doesn't dip tomorrw but continues rallying towards 34,250 ~ 34,500, then this could be the count in play. Larger message is the same as primary count i.e. bank nifty is nearing exhaustion.

But a rally to above 34,560 soon tomorrow without a dip first would have seriously bullish implications (see alt count 2 below).

Alternate count 2 : A rally to above 34,560 early tomorrow would immediately bring the prospect of higher prices at 35,300 ~ 37,300. This would also bolster the larger wave count which calls for potential new highs above 42,000 on bank nifty.

Parameters are clear for all 3 counts. We just need price to now choose between the 3 counts.

We will not be posting again on Bank Nifty for at least a couple of days, unless there is some material change, so pls decide trades or actions accordingly.

Bank Nifty update. As on Mon 4 July 2022. CMP 33,650. Posted at 10:20 am.

Bottom line : So far the upmove from 32298 remains choppy (primary & alernate 1 counts), but be on alert for a strong rally (alternate count 2).

All 3 below counts are valid as long as 32,290 is not violated soon.

Primary count : On the 2 hour chart, either a bullish triangle is playing out (or an ending diagonal). Either way, message is the same. After reaching 34,400 ~ 35,000 to complete wave ii, a strong wave iii to the downside should begin, eventually taking Bank Nifty to below 30,000.

Alternate count 1 : This shows the larger bearish triangle still not complete. Wave e is in progress. Once wave e is complete, a thrust lower to below 30K should follow.

Alternate count 2 (very bullish) : There is NO evidence yet to support this count, but option traders should be on alert for this particular count. This shows price could start a strong rally anytime in a 3rd wave.

Bank Nifty Update. As on Fri 1 July 2022. CMP 33,250. Posted at 11:05 am.

Bottom line : Short term expectation is for sideways to higher towards 34,500 ~ 35,000. Intermediate term Bank Nifty has options.

Primary count : Price should commence a choppy uptrend from near current levels. On the hourly chart, a potential ending diagonal would take price up to 34,500 to complete wave (e) of the bearish triangle, and subsequently fall hard thru strong support at 32,155.

Alternate count 1 : Message is almost identical to the primary count, except for a matter of technicality. A sideways to higher rally in the near term in a small bullish triangle would lead to a thrust up to 34,500 ~ 35,000 to complete wave ii of a thrust lower that has already begun.

Alternate count 2 : The lack of an impulsive 5 waves up on the hourly chart has significantly lowered the probability of this count, but it is still on the table. The rally from 32,298 has been very choppy.

This count shows a large bullish triangle complete, and price could be headed up to new all time highs. This needs serious confirmation for us to this to become trade-able, as it is looking more a distant possibility, rather than a serious probability.

Bank Nifty Update. As on Tues 28 June 2022. CMP 33,550. Posted at 10:20 am.

Bottom line : Bullish against 32,155. A break of 32,155 would immediately alter the preference towards alternate count 1.

Primary count : A rally to 35,500 ~ 36,500 is likely in wave E of a bearish triangle. On completion of which, a thrust lower to below 30,000 is on the cards.

Wave E up is likely not complete, as it has been too short in both time and distance.

Alternate count 1 : Price is thrusting lower from a bearish triangle, and completed wave i down at 32,290. Price is currently in wave ii, which could end at any time and set the stage for a wave iii decline which would likely breach the all important level of 32,155.

Alternate count 2 : The lack of an impulsive 5 waves up on the hourly chart has lowered the probability of this count, but it is still on the table. The rally from 32,298 has been very choppy.

This count shows a large bullish triangle complete, and price could be headed up to new all time highs.

Bank Nifty Update. As on Tues 21 June 2022. CMP 33,250. Posted at 12:30 pm.

Bottom line : The 32,155 level has not been violated. Probability has risen significantly of a bounce to at least the 35,500 ~ 36,500 level.

From previous post, Primary count has now been switched to alternate 2.

Primary count : A bounce to 35,500 ~ 36,500 is looking highly probable. Key level remains 32,155. A decline below 32,155 will immediately negate this count.

This count shows Bank Nifty is in wave E to the upside, which would complete the bearish triangle and set the stage for a thrust down to below 30,000.

Alternate 1 : This has been switched from alternate 2. This count shows a bullish triangle complete at 32,298. Under this count, Bank Nifty is beginning a thrust upwards, potentially to new all time highs above 41,827.

Alternate 2 : This will only come into play if 32,155 is violated within the next week or 2. This shows price has completed wave i down from a thrust and is in wave ii to the upside. Under this count 36,084 cannot be breached to the upside.

Bank Nifty Update. As on Thurs 16 June 2022. CMP 32,700. Posted at 2:30 pm.

Bottom line : Neutral. The key level of 32,155 has not yet been violated. A breach of 32,155 would likely confirm the thrust down from a bearish triangle is underway. Until that happens, a bullish outcome is still possible, however low the probability.

Primary Count : A thrust from a bearish triangle is underway. A break of 32,155 would bolster this count.

Alternate 1 : Wave d of this bearish triangle could still be in progress. As long as 32,155 is not violated soon, wave d could be ending anytime, and a rally to 36,000 level in wave e is likely.

Alternate 2 : Price is completing wave E of a large bullish triangle. Admittedly, given recent price action, this is looking far fetched, so some serious price action confirmation is required for this count to be taken seriously again. A break of 32,155 would negate this triangle in it's current form.

Bank Nifty Update. As on Thurs 9 June 2022. CMP 34,800. Posted at 12 pm.

Bottom line : Neutral to unclear, with a slight bullish bias. With Bank Nifty breaching 34,819, the picture has become unclear. We wait for some clarity to emerge.

Still providing some counts below, but further confirmation is required as both represent working hypotheses at this stage.

Count 1 : Possible double correction playing out in wave E of the bearish triangle. A smaller bullish triangle could be forming which, on completion, would result in a thrust up to 36,500 ~ 37,500 to complete wave E and set the stage for a thrust lower.

Count 2 : We cannot completely rule this out yet. We are still waiting to see if price rallies sufficiently to provide some clarity whether this pattern has any chance at all.

Bank Nifty Update. As on Mon 6 June 2022. CMP 35,300. Posted at 12:15 pm.

Bottom line : Short term bullish. 34,819 should not be touched under either count.

Count 1 : Bank Nifty has completed wave E of a large bullish triangle (see 3 day / weekly), and is set to thrust to new all time highs.

In the near term, waves 1 & 3 subwaves of wave 3 were of equal length. The probability of wave 5 subwave being extended is high. Bank Nifty should see the 38,000 level sooner rather than later.

Count 2 : This also calls for new highs above 36,100, likely 37K ~ 38K, but allows for a sideways movement before a thrust up to complete wave E of a bearish triangle.

Bank Nifty Update. As on 3 June 2022. CMP 35,535. Posted at 1:45 pm.

Bottom line : At least one more high to come above 36,083. Both counts are still on the table. Critical level is 34,819, which must not be violated in the near term under either count.

Count 1 : Price is in a 3rd of 3rd wave to the upside. Today's temporary correction needs to reverse soon to the upside for Bank Nifty to continue it's upward journey.

Count 2 : This count calls for one more high above 36,083, likely nearer the 37K level, after which wave E of the larger bearish triangle would be complete (See daily and 3 day chart), and set the stage for a large decline.

Near term, price is free to decline a little further as long as 34,819 is not violated. This small triangle on the hourly / 4 hour is by no means confirmed. This small correction from 36,083 could also take the form of a zigzag or flat.

Bank Nifty Update. As on Mon 30 May 2022. CMP 36,000. Posted at 12 noon.

Bottom line : Bank Nifty is up healthily from 33,000, but this rally has not taken the form of an impulsive 5 waves as yet. So it is difficult to be too sure whether Primary count is playing out to new all time highs or whether this rally is wave E of a bearish triangle. For guidance, it is our opinion the Nasdaq is the best index to spot a turn due to the clarity of it's structure.

Our bias is towards the primary count, but would not take much to change our view.

Primary Count : The larger bullish triangle likely completed at 33,009. Price is headed up to new highs above 42K.

On the hourly chart, the inverse head & shoulders worked out well.

Alternate count : Due to lack of clarity in the sub-waves of the rally from 33,009, this count remains an uncomfortable option, where Bank Nifty is tracing out wave e of a bearish triangle, which after completion, would commence to decline to below 30K on a thrust lower.

Bank Nifty Update. As on 26 May 2022 CMP 34,850. Posted at 1:45 pm.

Bottom line : With Bank Nifty showing expected strength, the thrust from the bullish triangle could be the count playing out. However, to be conservative, it is neccessary to always keep stop losses.

On the 1 hour chart : an inverse head & shoulders has been confirmed with a break of the neckline. This puts the stop loss below right shoulder for the bullish view.

Count 1 : Bullish triangle possibly complete at 32,155.

If wave E of the triangle is confirmed, price is heading up potentially to new all time highs above 42K.

Count 2 : Short term bullish, intermediate term bearish.

Price is in wave E of a bearish triangle potentially towards 37,000 before the larger decline commences.

Note that minimum requirement for wave E has already been met, so if this count plays, a decline could begin at any time.

Market Commentary. As on Mon 23 May 2022.

Discussion of co-relationships between Nasdaq, Nifty, and Bank Nifty.

Bottom line : Short term bullish and Intermediate term bearish.

Starting off with Nasdaq : There is a clear 5 wave impulse down from 16K to 11K. We take this very seriously. If companies like Alphabet (Google), Facebook, Microsoft etc are going to decline significantly, then it is most unlikely Indian companies and indices will be spared. Moreover, the patterns on the indian indices are also relatively clear although there is no 5 wave impulse to the downside.

Nasdaq formed a 5 wave impulsive decline with the 5th wave as the largest wave. Within the 5th wave, it’s own sub-divisions show the 5th wave was also extended. This could mean a rapid rally in the Nasdaq back to the 61% – 78% fibonacci retrace at 14,500 ~ 15,500 levels, which also coincides with 4th wave of lower degree. This makes it an important resistance level. As long as Nasdaq does not exceed the all time high of 16,765, the 5 wave impulse remains an extremely important signal.

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Bank Nifty : Since Nasdaq is the clearest of the major indices we have, a correlation with it would be a sensible way forward to deal with both Nifty & Bank Nifty. Bank Nifty has 2 counts, both are short term bullish to at least 36-37K. One of the counts calls for new all time highs above 42K.

2 seperate counts shown below.

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Nifty also has 2 options. Both of which are short term bullish. One of the options calls for a rally above 18,300. See previous Nifty post for short term analysis.

2 seperate counts shown below.

Conclusion : With a major index like Nasdaq providing a clear signal, it would be unwise to ignore it. At least another 5 wave down below the recent low of 11,492 is on the cards, but first a significant upward retrace (rally) is likely.

Bank Nifty Update. As on Fri 20 May 2022. Posted at 1:20 pm. CMP 34,200.

Bottom line : The crucial levels of 32,155 and the recent low of 33,007 held. Yesterday's mayhem did not violate even the higher level. We suspect it is now upward and onward from here to at least the 37,000 level, and possibly to new all time highs above 42,000.

Both these counts are based on 33,007 not being violated in the near term.

Count 1 : Intermediate term bearish. Short term bullish.

Count 2 : A larger bullish triangle could well be complete at 33,007 and price is in the early stages of a thrust up to new all time highs. Based on simple triangle width measurement, the target for wave 5 comes in at 44,000.

Bank Nifty Update. As on Wed 18 May 2022. CMP 34,300. Posted at 12:30 pm.

Bottom line : Near term Bullish against 33,807. On the 10 minute chart, price appears to in a 3rd of 3rd wave to the upside. 33,807 cannot be violated without re-evaluating the short term count.

Count 1 : The larger triangle appears complete at 33,009 and price is in the early stages of a large uptrend towards 38K ~ 39K, and potentially to new highs above 42K.

Count 2 : Price is in the early stages of wave D of a large bullish triangle.

Count 3 : This is intermediate term bearish. But even then, wave E to the upside is too short in terms of time. If new lows form in the near term below the recent low of 33,007, this count would take precedence over the others.

Bank Nifty Update. As on Monday 16 May 2022. CMP 33,597. Posted at 4:15 pm.

Bottom line : With price on Nifty & Bank Nifty hovering near the lows, further near term lows cannot be ruled out on both indices.

We view Bank Nifty's support level of 32,155 as more important than Nifty's support level at 15,671. It is important for all 3 counts below that it holds.

Bank Nifty count 1 : As long as 32,155 is not violated, there is a reasonable probability that wave E of a large bullish triangle is nearing completion.

Bank Nifty Count 2 : The level of 32,155 is also important in case wave D of the larger bullish triangle is still in progress.

Bank Nifty Count 3 : Even if price is in a larger bearish triangle, it is still important for the 32,155 level to not be violated, in order for wave E to commence to the upside.

Market Commentary. As on Thurs 12 May 2022.

We have a situation where Nifty and Bank Nifty are in conflict. In our experience, Bank Nifty usually wins out, but not always. As in all things market, anything can happen, but is useful to be aware of. Let us see if this conflict can be reconciled in any way.

Bank Nifty has an interesting pattern where a bullish triangle may be complete or almost complete. Whether today’s low has completed wave E, time will tell. A strong bullish pattern from here on BN may be just the tonic for Nifty to also test the 18,100 level.

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The problem with this is if new highs are expected in bank nifty that means an upside of 25% from current levels. This may be a stretch, but it is possible as long as 32,155 (wave C of triangle) is not violated.

There is a way to reconcile Nifty and Bank Nifty : It is that Bank Nifty ends with a truncation at about 38K ~ 39K in 5 waves, but falls short of new highs in its larger 5th wave, i.e. does not exceed 41,827.

This would then bring back focus into the Nifty alternate count where a test of 18,000 ~ 18,100 could be on the cards.

It is early to say, as 15,671 needs to hold first. Now lets deal with what happens if 15,671 gives way ? Read below.

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If 15,671 gives way, it is not necessarily one way bearish. There could still be significant bounces in the interim, with wave X taking the shape of a large bearish triangle, or even an expanded flat which would test the 18,000 ~ 18,100 level.

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Preferred count as long as 15,671 is not violated is the one shown this morning, which shows a bounce soon to above 17K.