Hey Guys,
Happy Monday.. Only we traders have the guts to say Happy Monday instead of Monday Blues :P
So lets jump to our analysis and why I am planning for an counter trend trade in SBI.
This is one of my favorite setups to trade, No matter what others say or think...I am deeply in love with counter Trend bcos it makes us analyze various reasons to enter trade &...
With Nifty being in overbought levels, we see SBI at the upper trendline. Although it broke to the upside, we see classic evening star formation at the upper trendline.
I would be cautious if I'm long here. You might want to sell your position partially and wait for a pullback towards,
T1 - 200
T2- 195
T3- 189 for short term.
Note : Unless some macroeconomic news affects banking sector, SBI has good potential to move up in coming weeks as most of loans written off & market has adjusted to that.
But Jun 14-16 with Fed meetings markets can react , Feds always do what they think right not what needs to be done.
The zone marked above has been tested 4 times, so I am expecting it will be...
Markets always has tendency to fill gap zones.
If you draw fib extensions / retracements on previous few swings , every 1.618 extension ends up in our marked zone
1618 is more valid ratio & we can expect market to move up after reaching the zone.
ABCD pattern completion also in same zone.
This is 4h chart of SBIN so will take time to complete, just keep it...
Lets keep patterns, triangles and Wave theory aside for sometime.
Lets keep it simple for State Bank of India , as you can clearly see simple trend continuation and we are planning to buy on the pull back completion.
Some may feel that how can we be so sure ? Well, as per my rule book trend continuations with good risk :reward are valid enough.
Please check...
SBI looks to have entered into a trend reversal phase with a 5wave count which can potentially be wave 1 of a bigger wave cycle. wait for a wave 2 pullback, rs170 can be a good price to enter. holding period 1year approx.
