Bank Nifty Target using Neo wave and Time cycle

banknifty neowave timecycle Jul 01, 2024

Neo wave along with a simple price indicator helps to form powerful setups with a good accuracy. In the previous monthly report dated on 14th June 2024 we anticipated possible rally in Bank Nifty. Bank Nifty moved precisely as expected!

Bank Nifty Weekly chart anticipated as on 14th June 2024

Bank Nifty Daily chart anticipated as on 14th June 2024

Wave analysis anticipated as on 14th June 2024

In the month of May 2024, Bank Nifty witnessed minor profit booking at the start of the month and later moved up and made fresh highs. However, due to Lok Sabha Election outcome which is a big event for Indian Markets, we have seen higher volatility since the start June month. On the event day, prices showed a sharp correction of 4900 points and later within next two days prices showed a sharp recovery of nearly 8-9% from the lows of 46077.

As shown on the 1st daily chart, we can see the entire rise from the lows of Covid 2020. Momentum was strong in the earlier legs of the Diametric pattern but now the momentum has been slowing. The ongoing primary wave G is looking like a wedge-shaped formation with lack of momentum. Nifty has managed to touch lifetime highs but participation from Bank Nifty is still awaited.

This is also in sync with the ongoing interest rate cycle. Since we are at high interest rates scenario the financial sector usually underperforms other sector. As mentioned earlier as well it is better to stay with defensive sector that can outperform banking stocks.

Nevertheless, overall trend for Bank Nifty is positive as there is no negative reversal yet.

On the next daily chart figure 6, we have shown Bollinger Bands. Wherein, prices are gradually moving towards the upper bands which is near 50800 levels. As per wave perspective, the fall that we saw on the Election Day was in form of wave f and now prices are moving up in form of wave g which is a last leg of a Diametric pattern. This leg has retraced more than 76.4% of prior leg which was wave f.

In a nutshell, overall outlook for Bank Nifty is positive for move back to 50660 followed by 50800 levels with support on downside at 48800 levels. Any breach below this support will indicate a triangle pattern possibility. As long as support holds use dips to buy but momentum can remain a concern.

Bank Nifty Daily chart happened as on 1st July 2024


In our monthly report we mentioned about possible more up move towards 50800 levels and gave hints above possible fresh highs in index! Bank Nifty moved precisely and achieved our target in just 2 days of span! Later Bank Nifty showed a classic rally and made a fresh high near 53180 which is more than 6% in short span of time.

For now, one should avoid catching tops and can use buy on dips method to ride the trend by keeping as long as 51900 level holds on the downside.

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