BankNifty's- Danger: Is this A Rising Wedge?– Time to Rethink

WaveTalks Updated   
Earlier in The Day - When Magical Level of 43350 Holds

Ending diagonal

Also known as an ending wedge, is a term used in the field of technical analysis to describe a specific chart pattern that signals the end of a trend or price movement. This pattern is characterized by converging trendlines that form a wedge shape and typically consists of five waves, with the third and fifth waves being smaller than the first and second waves.

Rising wedges are bearish reversal patterns that often signal the end of an uptrend, leading to a decline in prices.

Few classic examples from history where rising wedges have occurred, and financial instruments have collapsed:

1. The Dot-Com Bubble (2000):
2. The Global Financial Crisis (2007-2008): A rising wedge pattern emerged in the US housing market and various mortgage-backed securities leading up to the financial crisis.
3. The Crude Oil Crash (2014-2016): Crude oil prices experienced a sharp decline between 2014 and 2016 due to a combination of oversupply and weak demand. A rising wedge pattern was evident in crude oil prices before the crash.

As a trader, it is essential to be cautious and aware of potential risks when trading financial instruments that exhibit rising wedge patterns. Some tips to keep in mind are:

1. Stay informed about market trends and technical analysis patterns to identify potential reversal signals, such as the rising wedge.
2. Keep track of economic data, news, and events that could impact the financial instrument you are trading.
3. Practice proper risk management by using stop-loss orders and position sizing to minimize potential losses.
4. Diversify your trading portfolio to reduce the impact of a single financial instrument's collapse.
5. Remain disciplined and follow your trading plan, ensuring that you do not give in to emotions like fear or greed.

16th March 2023 :Last idea - Truncated Pattern Are Really Explosive : BankNifty

11:50 am / 15th May 2023

Last @ 44046

As discussed to our colleague @equityrider99, last Friday -12th May 2023

62% objective of Wave 1-3 Distance comes at 44085 so that could be next objective but have to be careful at tops as last legs are danger legs.

We are very close to the resistance zone.

Best Regards,
Abhishek H. Singh
​Growth Director - TradingView India

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