So, for last 2 weeks, I've had this "gut" feeling that the BankNifty would correct, and it has, by about 5% from the peak. If you look closely, you can extract a head and shoulder pattern, but a weak one, which means we could see a lower of 43,300.
I remain bearish, only because there is a gap fill at 40,000 which is another 4000 points below. But I can't say for sure if it will be a slow decline, or a sharp fall.
A slow decline is painful, as many will throw in the towel when the markets touch 40,000 level, and that's when you want to be buying. But a sharp fall like in a broken lift, will cause damage, but it will recover faster, as it indicates that free markets are at work, washing out the weak hands.
It looks like we're bottoming out at 44000 level, the longer this goes, the higher the move upward we could see.
As expected we have moved higher forming a good base. This could be the support going forward. But let's check other data points.
Looks like an attempt was made to breach the downward trendline, and that failed, indicating a possible downtrend! If before this expiry, we don't see it above the trendline, the stronger the indication is going to be.