How to Trade the Bullish Harmonic Pattern on the Bank Nifty

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  • May 19, 2022 - How to Trade the Bullish Harmonic Pattern on the Bank Nifty

How to Trade the Bullish Harmonic Pattern on the Bank Nifty

May 19, 2022

The Bank Nifty index hit a low of 33,001 at the start of this week. But then it reversed sharply from the bullish harmonic reversal level to 34,600 levels.

The bullish cypher harmonic reversal pattern is visible on the chart below.

Harmonic patterns are reversal in nature and indicates the probable reversal zone (PRZ) using multiple Fibonacci ratios.

Bank Nifty Index Daily Chart

 

Even after the gap-down opening today, this level is holding for now. The index has taken support at 88.60% Fibonacci level of previous rise from 33,001 to 34,655.

Looking at the structure, we may anticipate the probable bullish or inverse head and shoulder which will be confirmed above the neckline level of 34,700.

Considering the bullish harmonic pattern and probable inverted head and shoulder pattern, the lows of 33,387 and 33,000 will be acting as a strong support zone for bulls. This pattern will be negated on a close below 32,900.

At close, the Bank Nifty index was down by 2.48% at 33,315.

I'll share more on his trend on my Telegram group. If you're interested in being part of my charting journey as I share how to create wealth from profitable trade setups, join my telegram channel - Fast Profits Daily.

In the meantime, do check out the below video where I explain why banking stocks are the best stocks to trade right now.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...

Brijesh Bhatia

Brijesh Bhatia Research Analyst and expert chartist, is the editor of Alpha Wave Profits. Fully committed to his craft, Brijesh has mastered the art of making money by trading using technical analysis. Brijesh has an MBA from ICFAI and 16 years of experience in India's financial markets. He began his career on Dalal Street as commodities dealer and it wasn't long before he developed his own unique trading system. Brijesh worked on his trading system until it could be expected to deliver 5 units of return for every unit of risk.

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