22 Aug ’23 Post Mortem on BankNifty - stance is still bearish 🐻
The reason why we were bearish in the first place was the inability of BankNifty to take out the resistance of 44068. Today’s price action is the biggest proof on why it worked. If you notice the trades today, it was above or near this level till 13.40. Then banknifty started falling. And the final close came at 43950 - there was a noticeable fall of 160pts from 13.30 to close.
On the 1hr chart, the trades below the horizontal blue line ~ 44068 is quite visible. If banknifty stays here for a considerable amount of time - then its a good sign for the bears. The momentum for further falls will pick up pretty fast.
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.
On the 1hr chart, the trades below the horizontal blue line ~ 44068 is quite visible. If banknifty stays here for a considerable amount of time - then its a good sign for the bears. The momentum for further falls will pick up pretty fast.
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.
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