State Bank Of India

State Bank Of India

On the basis of Elliot Wave principle, I found that State Bank of India started its first impulsive wave i.e WAVE-1 of a Primary trend in the year 2002 on monthly charts. This wave started at Rs. 200 in the beginning of 2002 and went upto Rs. 2380 marking the end of wave-1 by the end of year 2007 (as shown in the graph). Thereto, it went into correction wave i.e WAVE-2 of the primary trend, as has been depicted in the graph, corrective wave started in early 2008 and continued till early 2009 completing 1 entire year of correction. To our amazement we see that WAVE-2 completed its formation exactly at the Fibonacci retracement level of 61.8 at Rs. 1000. From early 2009 WAVE-3 of the primary trend started which propelled prices to the level of Rs. 3225 by mid 2010. Year 2011 marked the beginning of the corrective wave i.e WAVE-4 of the primary trend. As a result of this price fell to Rs. 1620. One important thing is to be noted here though I am terming it as the 4th wave, however, as per the tenets of Elliott Wave Theory-base of wave 4 should remain at or above the apex of wave 1.In this case this tenet seems to have been violated.
At present it seems we are  in the beginning of the next Impulsive wave i.e WAVE-5 of the primary trend. As per my understanding of  EWT the chart now seems to be well poised for a rise till at least Rs 3225. This would result in a return of about 45% from CMP of 2235. I expect SBI to reach Rs 3225 mark and above by 2013 year end.