Bank Nifty Long-term bullish trend ready to reverse?
Analysis
What next?
A decisive break of the trendline (weekly close) will indicate the long term bull trend has surely taken a pause. Once price starts taking resistance from this trendline we can know for sure the trend has reversed.
We can project a downside target of 4000 points based on the head and shoulder pattern, this also sits roughly at the election day panic low.
Trade Plan
It's a little late to short now! Price is at a support and we don't short at support.
Wait and watch how price behaves next week, a break of the trendline is bearish - however if price again starts to take support and bounce a long trade of at least 2000 points as target can be planned.
In either case I will update the idea.
Good luck, Happy trading!
- Bank Nifty has been trading in a range of 4000 points for the last 6 months and has formed a Head and Shoulder pattern
- A bullish 45 degree trendline can be seen on the weekly chart, connecting all the bottoms since the covid19 low. The longer the trendline, the more valid it is
- Weekly candle in bank nifty has eroded most of the gains made in the last 4 weeks and closed on the trendline
What next?
A decisive break of the trendline (weekly close) will indicate the long term bull trend has surely taken a pause. Once price starts taking resistance from this trendline we can know for sure the trend has reversed.
We can project a downside target of 4000 points based on the head and shoulder pattern, this also sits roughly at the election day panic low.
Trade Plan
It's a little late to short now! Price is at a support and we don't short at support.
Wait and watch how price behaves next week, a break of the trendline is bearish - however if price again starts to take support and bounce a long trade of at least 2000 points as target can be planned.
In either case I will update the idea.
Good luck, Happy trading!
Aviso legal
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