1. Narrow rectangular box indicates central range, this range falls within weekly range hence this range will act as good for next day price movement. Hrly nifty closed above 27 , green is acting as good support, if prices advancing from here it will fulfill the formation with as support and red upper line as resistance. for breakout at least 3 peaks or vallies are ideal, if breakout to happen upside, price should not fall below green and remain above CPR range.
2. if price opens below CPR on gap down or on trading it will fall below green hence formations will invalid and / rectangular formation will active. with both upper and lower boundaries acting as resistance and support. again for breakout 3 peaks or 3 vallies are ideal, and if price reaches at lower red support line making a point no.2 which may attract buyer to enter and bring the prices at upper red resistance line making 3rd peak, and may breaks from here in next 1-2 days.
3. if price breaks lower resistance line making point no.2 it may be false breakout which may fill the gap created prior 1 week, false breakout downside will try to push the prices towards upper red resistance line, giving good opportunity to enter longs.
i may be wrong any day any time, i will change my sentiments as market decides.
please trade on your own risk, this is what i implementing study with practical on live market.