Banknifty Bear Channel Move Decoded.

28 Jul 2023

BANKNIFTY
Banknifty is moving in a bear channel which is just a correction in an uptrend.
yesterday it formed an outside bar on a daily timeframe, and it formed a very wide channel as you can see on the chart.

The price is expected to open a gap up and test the supply zone and fall again.

A sneak into the past:-
If you carefully observe the channels in the bull trend on the daily chart you will observe that the movement has some kind of pattern.
let me explain:- Majority of the time the price opens near the high of the channel range and by the day's end it tests the support line of the channel.


This occurs after a good fall and prices are not forming significant lower lows.
Mass psychology is that they want a 2nd leg up. so they are justifying buying from each new low as the price is cheap but the market is in a consolidation mode and will not start trending until the supply from the upper channel got exhausted.

I hope you found this helpful.
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Happy Trading!