Price Action Analysis:
The technical outlook of last week mentioned about MOB - A Make or Break situation in Nifty as price action had formed a Bullish Double Key Reversal price bar and was trading near the January quarter range resistance. On Monday price opened at 11270 with a soft gap indicating strength towards up direction finally closed as a Bearish Pin bar. Tuesday’s price action recorded new weekly high at 11374 and again formed a Bearish Pin bar. For the next two days price traded within the range of previous two bars and finally on Friday price broke the low of Monday and closed at 11178 with a Bearish Outside Bar in place. Price is currently trading below the January quarterly range resistance zone of 11201 and closed in the zone of March quarterly resistance zone 11178.
Weekly Price Action Analysis
Weekly Price Bar Structure:
Price Action formed a Bearish Single Key Reversal price bar. Price recorded a new high at 111374 by breaking the previous two weeks high and finally closed at 11178 which is below the previous week’s close 11214.
Price bar Range:
The range of the current week price bar is 262 compared to the previous week range of 365 which makes the current week price bar a narrow ranged price bar. Narrow ranged price bars represent dead markets, where the price movement is little and cover less ground per unit time indicating low volatility.
Position of Close:
The position of close is in the lower one third of the range indicating sellers have taken control over the buyers.
Body Size:
The size of body (92) is lesser than the wick ((170) both upper and lower wick combined). The current price bar is indeed a bearish price bar but with a short body indicating weak bearishness as a result of lack of strength, due to reduced commitment from sellers. Since the body size is lesser than the wick a detailed analysis of wick, buying and selling pressure is required to determine who is in control? Buyers or sellers and to what extent?
Wick Size:
Analysis of wick is required only when the size of wick is greater than body. The size of upper wick is 103 and the size of lower wick is 67. The upper wick is 1.5 times the size of lower wick indicating selling pressure is 1.5 times that of buying pressure. The upper wick represents selling pressure and is of importance size of upper wick is minimum 2.5 times that of the lower wick. In the present scenario the size of upper wick is just 1.5 times of the lower wick indicating indecision hence a further analysis of buying and selling pressure is required.
Buying and Selling Pressure:
The current price action depicts that selling pressure (195) is greater than buying pressure (67). Selling pressure is 2.9 times of the buying pressure indicating sellers in control. The strength is usually expressed in 3 degrees as Bearish, Strong Bearish, and Very Strong Bearish. The strength of the current price bar is Bearish.
Expectation and Confirmation:
With the current price action analysis we form a Bearish Expectation for the upcoming week. The bearish expectation will be confirmed only when price breaks the low of the Bearish Single Key Reversal price bar at 1111. The Bearish expectation will be invalidated on price surpassing the high of the bearish Single Key Reversal price bar at 11374.
Daily Price Action Analysis
On Friday price action formed a Bearish Outside Bar with higher volumes compared to the previous four days volume. On a daily time frame Price action from Monday to Thursday formed a consolidation price bar pattern a Ledge. The Outside bar of Friday broke the low and closed below the consolidation pattern Ledge. With a bearish outside bar breaking the low and closing below the Ledge, the outside bar also acts as a Trigger Bar for the consolidation price bar pattern. With the current price action analysis on a daily time frame we form a Bearish expectation. The Bearish expectation will be confirmed only when price breaks below the low of outside bar at 1111.
Key Levels and Weekly Volatility
The key level of the current trend is at 10882 and critical level at 10562. The current weekly volatility decreased to 1.1 compared to previous weekly volatility of 1.4. The probable weekly returns is of 133 points from the weekly close, with a measured move in increments of 66 points.
Trade Plan
The point of control of Nifty Spot for the upcoming week is in the zone of 11243. Price surpassing the point of control can find minor resistance in the zone of 11309 and major resistance in the zone of 11374. Price surpassing the major resistance at 11374 can further move towards the zone of 11440 and 11505.
Price staying below the point of control can find minor support in the zone of 11178 and major support in the zone of 11112. Price breaking below the major support can move much lower towards the zone of 11047 and 10981.
Disclaimer
All trade ideas published here are for educational purpose only. All investments involve risk, and the past performance of a security, industry, sector, market, financial product, trading strategy, or individual’s trading does not guarantee future results or returns. Investors are fully responsible for any investment decisions they make. Such decisions should be based solely on an evaluation of their financial circumstances, investment objectives, risk tolerance, and liquidity needs.
The technical outlook of last week mentioned about MOB - A Make or Break situation in Nifty as price action had formed a Bullish Double Key Reversal price bar and was trading near the January quarter range resistance. On Monday price opened at 11270 with a soft gap indicating strength towards up direction finally closed as a Bearish Pin bar. Tuesday’s price action recorded new weekly high at 11374 and again formed a Bearish Pin bar. For the next two days price traded within the range of previous two bars and finally on Friday price broke the low of Monday and closed at 11178 with a Bearish Outside Bar in place. Price is currently trading below the January quarterly range resistance zone of 11201 and closed in the zone of March quarterly resistance zone 11178.
Weekly Price Action Analysis
Weekly Price Bar Structure:
Price Action formed a Bearish Single Key Reversal price bar. Price recorded a new high at 111374 by breaking the previous two weeks high and finally closed at 11178 which is below the previous week’s close 11214.
Price bar Range:
The range of the current week price bar is 262 compared to the previous week range of 365 which makes the current week price bar a narrow ranged price bar. Narrow ranged price bars represent dead markets, where the price movement is little and cover less ground per unit time indicating low volatility.
Position of Close:
The position of close is in the lower one third of the range indicating sellers have taken control over the buyers.
Body Size:
The size of body (92) is lesser than the wick ((170) both upper and lower wick combined). The current price bar is indeed a bearish price bar but with a short body indicating weak bearishness as a result of lack of strength, due to reduced commitment from sellers. Since the body size is lesser than the wick a detailed analysis of wick, buying and selling pressure is required to determine who is in control? Buyers or sellers and to what extent?
Wick Size:
Analysis of wick is required only when the size of wick is greater than body. The size of upper wick is 103 and the size of lower wick is 67. The upper wick is 1.5 times the size of lower wick indicating selling pressure is 1.5 times that of buying pressure. The upper wick represents selling pressure and is of importance size of upper wick is minimum 2.5 times that of the lower wick. In the present scenario the size of upper wick is just 1.5 times of the lower wick indicating indecision hence a further analysis of buying and selling pressure is required.
Buying and Selling Pressure:
The current price action depicts that selling pressure (195) is greater than buying pressure (67). Selling pressure is 2.9 times of the buying pressure indicating sellers in control. The strength is usually expressed in 3 degrees as Bearish, Strong Bearish, and Very Strong Bearish. The strength of the current price bar is Bearish.
Expectation and Confirmation:
With the current price action analysis we form a Bearish Expectation for the upcoming week. The bearish expectation will be confirmed only when price breaks the low of the Bearish Single Key Reversal price bar at 1111. The Bearish expectation will be invalidated on price surpassing the high of the bearish Single Key Reversal price bar at 11374.
Daily Price Action Analysis
On Friday price action formed a Bearish Outside Bar with higher volumes compared to the previous four days volume. On a daily time frame Price action from Monday to Thursday formed a consolidation price bar pattern a Ledge. The Outside bar of Friday broke the low and closed below the consolidation pattern Ledge. With a bearish outside bar breaking the low and closing below the Ledge, the outside bar also acts as a Trigger Bar for the consolidation price bar pattern. With the current price action analysis on a daily time frame we form a Bearish expectation. The Bearish expectation will be confirmed only when price breaks below the low of outside bar at 1111.
Key Levels and Weekly Volatility
The key level of the current trend is at 10882 and critical level at 10562. The current weekly volatility decreased to 1.1 compared to previous weekly volatility of 1.4. The probable weekly returns is of 133 points from the weekly close, with a measured move in increments of 66 points.
Trade Plan
The point of control of Nifty Spot for the upcoming week is in the zone of 11243. Price surpassing the point of control can find minor resistance in the zone of 11309 and major resistance in the zone of 11374. Price surpassing the major resistance at 11374 can further move towards the zone of 11440 and 11505.
Price staying below the point of control can find minor support in the zone of 11178 and major support in the zone of 11112. Price breaking below the major support can move much lower towards the zone of 11047 and 10981.
Disclaimer
All trade ideas published here are for educational purpose only. All investments involve risk, and the past performance of a security, industry, sector, market, financial product, trading strategy, or individual’s trading does not guarantee future results or returns. Investors are fully responsible for any investment decisions they make. Such decisions should be based solely on an evaluation of their financial circumstances, investment objectives, risk tolerance, and liquidity needs.
Trade active:
Price action made a high at 11249, formed a Reversal Price Bar in the Point of Control Zone at 11243.
Trade closed manually:
From the high of 11249 price reached made a low at 11144 and price action resulted as False Breakout near the the minor support zone and hence trade exited at 11243.
