23 Aug ’23 Post Mortem on BankNifty | BN becomes a 🚀🚀🚀
We will start with BankNifty today, because we had a reversal pattern today. According to me trend changes are first spotted on BankNifty and hence it works as a leading indicator.
This is what I said in yesterday’s report: Also note that the falling wedge will converge tomorrow, so a strong up move is more dangerous. The bulls will use that opportunity to drive the prices up and it could even take out the 44800 levels in one go.I am not quite sure which of these scenarios will work for tomorrow. I am inclined to go with the bearish stance as its still under the resistance of 44068.
What really happened today is Banknifty took out the resistance of 44068 by 11.05 and went all the way up to 44521. There was a swing of 567pts ~ 1.29% today. Literally BN became the rocket today. We did breakout from the falling wedge pattern and turned bullish.
The same is shown on the 1hr TF, notice we had 4 hourly candles above the bearish trend line. This indicates a breakout usually. Also the candles at 10.15 and 12.15 (before and after the break) were strong enough suggesting a change in sentiment.
Luckily we were prepared for such a scenario today and did not mess up with the existing short position. The reason I took up banknifty analysis before nifty is to show you that Nifty did not have a clean break today. Whereas BN did, the reason could also be due to the slope of the falling wedge. The convergence of the bearish trendline and the horizontal support happened today - so Banknifty had to either breakout or breakdown.
Though I dont exactly know what change in fundamentals caused the breakout, from the technical analysis angle - the move did not come as a surprise. I wish to change my stance from bearish to bullish for tomorrow. If we fall below 44068 in the morning session, I might have to go bearish again.
This is what I said in yesterday’s report: Also note that the falling wedge will converge tomorrow, so a strong up move is more dangerous. The bulls will use that opportunity to drive the prices up and it could even take out the 44800 levels in one go.I am not quite sure which of these scenarios will work for tomorrow. I am inclined to go with the bearish stance as its still under the resistance of 44068.
What really happened today is Banknifty took out the resistance of 44068 by 11.05 and went all the way up to 44521. There was a swing of 567pts ~ 1.29% today. Literally BN became the rocket today. We did breakout from the falling wedge pattern and turned bullish.
The same is shown on the 1hr TF, notice we had 4 hourly candles above the bearish trend line. This indicates a breakout usually. Also the candles at 10.15 and 12.15 (before and after the break) were strong enough suggesting a change in sentiment.
Luckily we were prepared for such a scenario today and did not mess up with the existing short position. The reason I took up banknifty analysis before nifty is to show you that Nifty did not have a clean break today. Whereas BN did, the reason could also be due to the slope of the falling wedge. The convergence of the bearish trendline and the horizontal support happened today - so Banknifty had to either breakout or breakdown.
Though I dont exactly know what change in fundamentals caused the breakout, from the technical analysis angle - the move did not come as a surprise. I wish to change my stance from bearish to bullish for tomorrow. If we fall below 44068 in the morning session, I might have to go bearish again.
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