SBI is in a very very long term corrective, which may target 1200 or lower. For the time being, it may be reaching an intermediate support level and can bounce above 1900 before resuming the down-trend.
The monthly chart below makes me perceive that either an impulse was completed at 3515 or it was the first fractal of an ED. The subsequent move is either a corrective of the entire impulse (if it is complete) or its the 2nd fractal of ED. If it is 2nd fractal of ED, then it must not go below 891 otherwise it should ideally go below 891. Presently, the C of this corrective is in progress and it should atleast test the purple LTL. A divergence in 14 day RSI is likely to take place within the corrective.
A closer look at the weekly chart shows that SBI has been moving within a broader range of 1570-2551 for an year now. The moves are in a box pattern with target of 1000 points in the direction of breach. There is a confluence zone of TLs (shown in green) near 1550 at the bottom of the box, which should provide some support. There is a WW (shown in blue), which has base line near 1920. A backtest (if not a re-claim) of this TL is due. The TL shown in Purple could be the final target of this fall. There is no immediate divergence visible in the weekly chart.
A look at the daily chart reveals that the fall has shaped up into a H&S pattern. The fall from 2551 should shape up as an impulse or an ED. That gives scope for a rise till 1976. The neckline of this H&S is shown in blue (and this is also the baseline of the WW mentioned for weekly chart). This TL will pose a resistance for any rise and is well below 1976. I expect a rise to this line and resumption of the fall till atleast the target of this H&S is met. Presently the price action is contained within both green TLs and a break out from this range will define the next move. A clear positive divergence is visible.
Trade Setup - Longs can be initiated near the green LTL for target of 1900. Breach of red UTL will provide confirmation to carry the trade and should be used to revise the SL just below green LTL.
Shorts can be initiated either near 1910 or below green LTL. Target for the short could be 1400 or lower. SL above blue TL should be used to protect the trade.
Note : All references mentioned in the trade setup is as per daily chart.
The monthly chart below makes me perceive that either an impulse was completed at 3515 or it was the first fractal of an ED. The subsequent move is either a corrective of the entire impulse (if it is complete) or its the 2nd fractal of ED. If it is 2nd fractal of ED, then it must not go below 891 otherwise it should ideally go below 891. Presently, the C of this corrective is in progress and it should atleast test the purple LTL. A divergence in 14 day RSI is likely to take place within the corrective.
A closer look at the weekly chart shows that SBI has been moving within a broader range of 1570-2551 for an year now. The moves are in a box pattern with target of 1000 points in the direction of breach. There is a confluence zone of TLs (shown in green) near 1550 at the bottom of the box, which should provide some support. There is a WW (shown in blue), which has base line near 1920. A backtest (if not a re-claim) of this TL is due. The TL shown in Purple could be the final target of this fall. There is no immediate divergence visible in the weekly chart.
A look at the daily chart reveals that the fall has shaped up into a H&S pattern. The fall from 2551 should shape up as an impulse or an ED. That gives scope for a rise till 1976. The neckline of this H&S is shown in blue (and this is also the baseline of the WW mentioned for weekly chart). This TL will pose a resistance for any rise and is well below 1976. I expect a rise to this line and resumption of the fall till atleast the target of this H&S is met. Presently the price action is contained within both green TLs and a break out from this range will define the next move. A clear positive divergence is visible.
Trade Setup - Longs can be initiated near the green LTL for target of 1900. Breach of red UTL will provide confirmation to carry the trade and should be used to revise the SL just below green LTL.
Shorts can be initiated either near 1910 or below green LTL. Target for the short could be 1400 or lower. SL above blue TL should be used to protect the trade.
Note : All references mentioned in the trade setup is as per daily chart.
No comments:
Post a Comment