Nifty PSU Bank Index. As on 6 Feb 2021. CMP 2277
Bottom line : Both counts intermediate term Bullish. Price has exploded above the 1900 level that was formidable resistance. It should now become a formidable support level.
PSU banks should be an excellent bet going forward.
Primary count : Price is heading up to the 2650 ~ 2700 level in a 3rd of 3rd wave. This level represents the next resistance level.
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Alternate count : This count shows price could be in a 4th wave correction that would come back to test the 1900 level in a possible triangle. For this count to remain valid, price needs to begin correcting almost immediately.
Nifty PSU Bank Index. As on Sat, 30 Jan 2021. CMP 1814.
3 waves up are visible from 1078 to 2003. Waves 1 and 3 have sub-divided into 5 waves.
There are 3 options here.
- Price is currently in a wave (iv) correction (most likely).
- Price is currently in a 1-2-1-2 pattern (2nd option, and very bullish)
- Price currently could have completed an abc zigzag to the upside (neutral to slightly bearish)
Given all these options, keep it simple. As mentioned earlier, the 1900 ~ 1910 level represents formidable resistance. The recent high of 2003 gives us one more resistance level.
Price needs a weekly (or monthly) close above this 2003 level to bolster the bullish count.
Nifty PSU Bank Index. As on 13 Jan 2021. CMP 1952. Posted at 10:20 am.
Price is moving beautifully as befits a 3rd of 3rd wave rally. The daily close yesterday above 1907 supports the view that a 3rd of 3rd wave rally is underway.
Price needs to continue closing above this 1900 ~ 1910 level to keep this count relevant.
Expect strong continued upside to the 2660 level which is the next level of major resistance.
Nifty PSU Bank Index. As on 28 Dec 2020. CMP 1740. Posted at 1:40 pm.
As expected, the strong 1900 resistance level did repel price lower to below 1600. (see previous post).
The hypothesis for now is price is in a 1-2-1-2 wave count in anticipation of a 3rd of 3rd wave rally. As long as price remains at or below 1900, it is likely the correction is in progress.
Given the strength of resistance at 1900 level, we would wait for price to close at 1960 ~ 1970 to be confident of the trend.
A move above 1960-1970 would likely confirm that price has broken thru the resistance and is on route to higher levels where the next major resistance is at 2650 ~ 2750.
Nifty PSU Bank Index. As on 11 Dec 2020. CMP 1858
In post of 2 Dec, when this index was at 1582, we said "Price appears to be in a 3rd wave rally that should reach the 1900 level."
On Dec 9, literally 8 short days later, price hit 1902.
This 1900 level is formidable resistance going back many years.
A correction is expected from current levels in maybe a 1-2-1-2 wave count.
We would be surprised if price continued straight thru this resistance level. Just in case it does, it means the PSU bank trend is super strong and strong resistance is not being respected.
Nifty PSU Bank Analysis. As on 1 Dec 2020. CMP 1582
Probability is now high that a secondary low is in place at 1233 / 1244. Price appears to be in a 3rd wave rally that should reach the 1900 level.
Ichimoku Cloud : Price is comfortably above the cloud. There is minor resistance at the 1602 level, which could cause the rally to pause / correct.
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Primary count : Price is headed up in a 3rd wave rally that should reach the 1900 level. The 1900 level represents a confluence of 2 resistances.
- This is where wave 3 would be a fibonacci exention 1.618 times wave 1.
- Strong horizontal resistance on the monthly chart (See red line on weekly / monthly)
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Alternate count : This alternate recedes further into the background. It is likely this count would be discarded from next update, but we are keeping it just in case.
This count shows the rally needs to halt dead in its tracks almost immediately and begin a decline in a possible ending diagonal.
Nifty PSU Bank Index. As on 20 Nov 2020. CMP 1439
Bottom line : Neutral.
From previous post of 7 Nov "A low could be in place, but it is not confirmed. Further evidence is required."
Ichimoku Chart : Price has closed above the cloud for the past 2 days, but today has slipped into the cloud. For the bullish case, price needs to remain above the cloud to gain confidence a low is in place.
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Primary count : A low could be in place at 1244 as a truncation. Price could be in a 3rd wave up. If so, price needs to accelerate up next week. This lies with the interpretation that the rally from 1078 to 1573 is a 5 wave pattern.
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Alternate count (bearish) : The decline from 1661 to 1233 is in 3 waves, leaving open the door for an ending diagonal, meaning further lows. (Or it could be some larger bearish triangle in play, if the rally from 1078 to 1661 is interpreted as 3 waves instead of 5).
Nifty PSU Bank Analysis. As on 7 Nov 2020, Saturday. CMP 1374.
Bottom line : Neutral.
Short term bullish.. possibly. But Intermediate term neutral.
A low could be in place, but it is not confirmed. Further evidence is required.
Before turning bullish, we would be cautious for the following reasons :
- On the 3 day or weekly chart (not shown), there is no evidence of a 5 wave up.
- Unless price has formed a truncated 5th, further new lows are still possible.
- On the daily chart (shown), Ichimoku still shows price below the cloud.
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Primary count : In the short term, price could rally above 1661 in either wave 3 or wave C. It is ok for a trader to be bullish (as long as a stop loss is maintained), but to be conclusively bullish from an investor point of view is premature. If price is in a 3rd wave up, then it is preferable for the gap up from 1336 to not be tested.
This also assumes the rally from 1078 to 1573 is a 5 wave pattern.
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Alternate count (bearish) : The decline from 1661 to 1233 is in 3 waves, leaving open the door for an ending diagonal, meaning further lows. Or it could be some larger bearish triangle in play, if the rally from 1078 to 1661 is interpreted as 3 waves instead of 5.
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Ichimoku : Price is below the cloud, and has tested the underside of the cloud from below. If price has indeed reversed trend, then the gap up from 1336 should not be filled, and price should continue up strongly from current levels and penetrate the cloud easily, leaving the gap as a break-away gap.
Nifty PSU Bank Index Elliott Wave Analysis. As on 26 Oct 2020. CMP 1319. Posted well before market hours.
Bottom line : A turn is possible after a further small decline. But further confirmation is required. 1078 is critical support.
In the near term, a decline is preferred in a small wave (5) that ends below 1233 but above 1078.
1078 remains the key level. 1 tick below 1078 would invalidate the 5 wave rally, and the subsequent expanded flat.
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The Ichimoku chart shows price is below the cloud. The Pink line (9 period moving average) is also below the brown line (26 period moving average). So there is no sign of a trend reversal as yet.
Given that Ichimoku is more a trend following system, for an elliottician it could serve as confirmation if the pink line crosses above the brown line, and further confirmation when price closes above the cloud on a daily basis.
