Using Price action & candlesticks to decode what Nifty is doing
In our last post on Nifty, we had mentioned that Nifty now seems to be forming an X wave with expected target around 24,350 to 24,450.
Nifty made a high of around 24,419 on Friday, August 9, 2024.
So, where do we go from here?
Nifty has been moving up, and a break above 24,420 should act as a break-out to take it further upside.
However, look at the price action and candlesticks and ask yourself, “Can we call this a breakout?” “Does this breakout mean Nifty has changed its trend?”
The candlesticks seem to be saying that although Nifty is going up, there is nothing in it for the buyers.
In this 1-hour chart, from August 6th to 9th (red Circle), can you figure out how many candlesticks seem to show that buyers have made an impact? From 23,960, Nifty moved to 24,419, a rally of almost 450 points, yet can’t see even one big green candle.
Decoding the candlestick pattern seems to tell us that this upside move is not a result of buying. It is happening for Nifty to go up and grab liquidity at the top, post which we should again see a downtrend.
So, where can Nifty grab liquidity?
If Nifty breaches the 0.5% mark, there is a high probability that it will reach between the Fibonacci 0.618% and 0.786% level. This is the area from where we can see a downward move again.
Disclaimer: We are not SEBI registered. The content presented here is based on personal opinions. Conduct your own research and consult with a qualified financial advisor before making any investment decisions.
Nifty made a high of around 24,419 on Friday, August 9, 2024.
So, where do we go from here?
Nifty has been moving up, and a break above 24,420 should act as a break-out to take it further upside.
However, look at the price action and candlesticks and ask yourself, “Can we call this a breakout?” “Does this breakout mean Nifty has changed its trend?”
The candlesticks seem to be saying that although Nifty is going up, there is nothing in it for the buyers.
In this 1-hour chart, from August 6th to 9th (red Circle), can you figure out how many candlesticks seem to show that buyers have made an impact? From 23,960, Nifty moved to 24,419, a rally of almost 450 points, yet can’t see even one big green candle.
Decoding the candlestick pattern seems to tell us that this upside move is not a result of buying. It is happening for Nifty to go up and grab liquidity at the top, post which we should again see a downtrend.
So, where can Nifty grab liquidity?
If Nifty breaches the 0.5% mark, there is a high probability that it will reach between the Fibonacci 0.618% and 0.786% level. This is the area from where we can see a downward move again.
Disclaimer: We are not SEBI registered. The content presented here is based on personal opinions. Conduct your own research and consult with a qualified financial advisor before making any investment decisions.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.