Bank Nifty Update. As on 6 Aug 2020. CMP 21,642 (Posted well after market hours).
While the Nifty 50 is offering us conflicting options, the Bank Nifty has been reasonably clear with it’s counts and has kept us bullish (or at least sideways to bullish).
It is worth focusing on the Bank Nifty. Both counts are not bearish.
One count is sideways to bullish for the next 2-3 weeks before a decline, the other is strongly bullish without a near term decline.
The manner of the expected rally in the next week or 2 in Bank Nifty has become vitally important to determine if and when we should turn bearish on equities.
Primary count : This shows price in a complex triple zigzag W-X-Y-X-Z that should take price to the 25,000 ~ 26,000 level to complete wave Z.
In the very near term, price is also bullish in a likely small 3rd wave of wave A. Only a daily close below 20,926 would put this count in jeopardy.
Alternate count : This count is very bullish for a rally in wave 3 (or wave C). This count shows a larger wave 4 ended in a truncation. Then a leading diagonal formed (as wave 1 or A) followed by a perfect flat correction (in wave 2 or B).
Under this count, price should rally strongly to the 26,000 ~ 27,000 level in wave 3, which could be followed by waves 4 down and wave 5 up again.