Bank Nifty : Update on Rising Wedge (Log Scale)

As posted 3 days back on emergence of Rising Wedge pattern in Bank Nifty on weekly chart, Index found resistance on upper trend line at 31705. We had told that risk is overshadowing returns at this juncture and index could find resistance in the zone of 31400-31600. Today Index fell by more than 1300 points from the top which confirms the Rising wedge pattern. Today's candle on daily chart has almost engulfed candle of last 3 days. We still maintain our cautious to bearish approach in bank nifty and expect Index to test previous low of 28400 in coming sessions. It can even ouch 25500-26000 in coming months , provided 31750 should be hold as resistance on weekly closing basis. Rise towards 30650-30800 would be the opportunity to go short with stop loss above 31100 for positional traders. Market has already discounted 25 basis point cut in June interest rate policy. If RBI doesn't cut interest owing to concern over monsoon and energy related inflation then we might see a steep fall in banking stocks.

Dagangan aktif:

Please modify SL to 31150.

Dagangan ditutup: hentian tercapai:

Stop loss hit.

Overall view is still bearish till the time Bank Nifty is closing below 31750 on weekly basis