Bank Nifty is the index that showcases the health of the economy. Last month, it was marked that when Nifty rose from the lows of 7511 towards the level of 11795 in August, Bank Nifty had participated in the very fag end of the up move and even now, Nifty broke the prior high of 11795 but Bank Nifty index has been a laggard all this time.

The below chart of Bank Nifty with Time cycle and FLDs was published in September monthly research report “The Financial Waves Monthly update”

Bank Nifty Daily chart with Time Cycles & FLDs

Chart Analysis:

The …day time cycle is working exceptionally well on the daily chart since April. The low made by wave (b) on 24th September was just a day prior to the cycle low day. This is how combining time cycles along with wave theory produces excellent trade setups.

Future Line of Demarcation is an important time tool that helps us to project price targets, support and resistance levels and to understand the underlying trend. As can be seen on the chart, the intersection of FLD along with prices usually happens during the midway of the cycle. Targets are derived by measuring the distance from the lows till the FLD intersection and then projecting it on the upside. From the important low formed on 24th September, price and FLD intersection happened at 22470, giving an approximate target of ….. on the upside.

However, it must be noted that FLD is a parameter that generally produces a same move on the other side as that before the intersection. But, it may overshoot or undershoot the target, if the bigger degree cycle has turned in the opposite direction.

Above extract is partially taken from recent Monthly research report that allows you to understand and learn the new tool Future line of demarcation along with Time Cycles.

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Next Mentorship starting from November 2020: I will be discussing all of the above methods on how to identify patterns and combine them with important indicators and Elliott wave, Neo wave theory, Hurst’s Time cycles. Only limited seats, Register now.