The Bank Nifty has formed a 'Cup & Handle pattern' & can surge to 44000+: TA Expert

Discussion in 'Traders Corner' started by Michael Gonsalves, Oct 30, 2022.

  1. Michael Gonsalves

    Michael Gonsalves Member Staff Member

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    After the NR7 pattern, the Bank Nifty has now formed a 'Cup & Handle pattern' & can surge to 44000+.

    Ghanshyam's last prediction that the Bank Nifty has formed a NR7 pattern and that it would give a breakout came true. The Bank Nifty surged a mammoth 2200 points from 39700 to 41500 in almost a vertical trajectory.

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    So, it is obvious that everyone is now eager to listen to his other predictions as well.

    Ghanshyam has stated that the Bank Nifty has now formed a "Cup and Handle pattern" if one looks at the chart from October 2021 to date. 41755 is the top of the handle which will provide immense resistance and be difficult to breach. However, if it does closes above that, we can expect a breakout. That breakout will provide a gain of as much as 3000 to 3500 points, he said.

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    The target, if and when the breakout happens, will be 44000 and 45120.

    Other experts on Technical Analysis have corroborated this view. According to Investopedia, A cup and handle is considered a bullish signal extending an uptrend, and it is used to spot opportunities to go long. Technical traders using this indicator should place a stop buy order slightly above the upper trendline of the handle part of the pattern.

    It is also stated that once a cup and handle pattern forms, in order to generate a bullish trade signal, the price must break above the top of the handle that has formed. A drop below the handle is not necessarily bearish. The price may drop slightly, then rally back up, forming another handle or breaking above the initial handle.

    The Bank Nifty will stay strong until 40800 is held

    Ghanshyam also stated that the Bank Nifty should be bought on dips until 40800 is held. The sellers will not become aggressive until it stays above that level. So, we can go long with a stop loss of a closing below 40800, he advised. It is implied that if it does breach the level of 40800, we can go short.

     
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