- Rising Channel/ Rising Wedge/ Ending Diagonal Pattern (call it whatever) has formed on Nifty 4Hr Chart - Triple RSI Bearish Divergence + MACD Divergence - Today we saw a Steep Sell off (Wide Range Bear Candles) - Market breadth has shifted in favour of declines to 1:2; it was at 6:1 during the opening today - On Nifty's Daily Chart, we got an RSI breakdown below 70 too today, Weekly RSI has not yet managed to cross 70 - FIIs had been buying vigorously since November start but today they barely bought 24.2 Cr, once they start selling we would have not only DIIs who have been selling recently but also FIIs putting that selling pressure - Thanksgiving is on Thursday and US markets are shut on that day, the following Black Friday US markets will operate half day. And then the coming Monday is Guru Nanak Jayanti so Indian markets are shut on Monday. Hence, Long weekend ahead likely to see Long Unwinding - Sentiment has been Extremely Positively recently and the Markets are short term overheated along with many individual stock names especially in Banking & Financials, this all calls for a Short term Correction - If you look at individual Stock Charts of Nifty 50 Heavyweights, then you will see Weakness there too for the short term, hence the Heavyweights can drag the Index down steeply - Remember Markets Top out on Good News and Bottom out on Bad News. With the recent Vaccine news, it seems that now all Good news has been discounted by the Markets so what's left to push it higher?
"The best trades are the ones in which you have all three things going for you: fundamentals, technicals, and market tone" - Michael Marcus, Market Wizard
Our Short Thesis for Nifty checks quite a good number of Criteria. So there you have a recipe for a High Probability Trade !
Downside Risk Open to 12,475 as per the Pattern View Negates above today's High Happy Trading :)
Sir, shouldn't we look at the option chain too to identify key support & resistance levels?
Also please refrain from writing crash in the title when you only anticipate a correction in the overheated market. The community won't panic that way :)
Also please refrain from writing crash in the title when you only anticipate a correction in the overheated market. The community won't panic that way :)