Price Action Analysis:
After six consecutive weeks of price advance, for the first time price formed a bearish SKR price bar on weekly time frame with price making a new high at 11342 and finally to close at 11073. For the past 6 weeks price witnessed a weekly higher close but, for the first time the close of current price bar is below the previous close. As a result of the present price action the current price bar structure nomenclature is a Bearish SKR.
At the start of the week price opened near the previous close and made a new high indicating bulls in control. After the new high bears overtook the control as result of which price declined below the previous week high then below the point of control and finally closed below the previous week close. The position of close of the current price bar is in the lower one third of the range indicating bears have an upper hand compared to the bulls. The size of body (151) is almost equal to the size of wick (163) (both upper and lower wick combined) indicating bearishness after a tug of war between the bulls and bears. The weekly selling pressure (268) is 5.7 times that of the weekly buying pressure (47). The weekly bar is a bearish SKR price bar and the characteristics of close, body, wicks, buying and selling pressure indicate bearishness. With a bearish SKR price bar we form a bearish expectation. The bearish expectation will be confirmed only when price breaks the low of the SKR at 11026. The bearish expectation will be invalidated if price surpasses the high first at 11342 without breaking the low.
On a daily chart with a new high at 11342 the key level of the existing uptrend is at 11089 and the critical level at 10562. For the first time after 114 days price has breached the key level at 11089, made a low at 11027 and finally closed below the key level. With the breach of key level price made a lower low hence the market condition of nifty is UP TREND UNDER PRESSURE. The most important thing to observe is that the price projection between each swing high decreased. The current price projection increased when compared with the previous price depth. The price angulation of the current decline is steep when compared with the price angulation of the recent rally. A valid break of the uptrend line with the touch points at 8806 and 10595 will be first indication of change in the ongoing trend. As of now we just have a lower low in place. For the downtrend to start price should make a lower high followed by a lower low. The current weekly volatility remains unchanged at 2 compared to previous weekly volatility of 2.1. The probable weekly returns is of 226 points from the weekly close, with a measured move in increments of 79 points.
Trade Plan
The point of control of Nifty Spot for the upcoming week is in the zone of 11184. Price moving above the point of control can find minor resistance in the zone of 11263 and major resistance in the zone of 11342. Price surpassing the major resistance can further move towards the zone of 11420 and 11499.
Price staying below the point of control at 11184 can find minor support in the zone of 11105 and major support in the zone of 11026. Price breaking below the major support can move much lower towards the zone of 10948 and 10869.
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.
After six consecutive weeks of price advance, for the first time price formed a bearish SKR price bar on weekly time frame with price making a new high at 11342 and finally to close at 11073. For the past 6 weeks price witnessed a weekly higher close but, for the first time the close of current price bar is below the previous close. As a result of the present price action the current price bar structure nomenclature is a Bearish SKR.
At the start of the week price opened near the previous close and made a new high indicating bulls in control. After the new high bears overtook the control as result of which price declined below the previous week high then below the point of control and finally closed below the previous week close. The position of close of the current price bar is in the lower one third of the range indicating bears have an upper hand compared to the bulls. The size of body (151) is almost equal to the size of wick (163) (both upper and lower wick combined) indicating bearishness after a tug of war between the bulls and bears. The weekly selling pressure (268) is 5.7 times that of the weekly buying pressure (47). The weekly bar is a bearish SKR price bar and the characteristics of close, body, wicks, buying and selling pressure indicate bearishness. With a bearish SKR price bar we form a bearish expectation. The bearish expectation will be confirmed only when price breaks the low of the SKR at 11026. The bearish expectation will be invalidated if price surpasses the high first at 11342 without breaking the low.
On a daily chart with a new high at 11342 the key level of the existing uptrend is at 11089 and the critical level at 10562. For the first time after 114 days price has breached the key level at 11089, made a low at 11027 and finally closed below the key level. With the breach of key level price made a lower low hence the market condition of nifty is UP TREND UNDER PRESSURE. The most important thing to observe is that the price projection between each swing high decreased. The current price projection increased when compared with the previous price depth. The price angulation of the current decline is steep when compared with the price angulation of the recent rally. A valid break of the uptrend line with the touch points at 8806 and 10595 will be first indication of change in the ongoing trend. As of now we just have a lower low in place. For the downtrend to start price should make a lower high followed by a lower low. The current weekly volatility remains unchanged at 2 compared to previous weekly volatility of 2.1. The probable weekly returns is of 226 points from the weekly close, with a measured move in increments of 79 points.
Trade Plan
The point of control of Nifty Spot for the upcoming week is in the zone of 11184. Price moving above the point of control can find minor resistance in the zone of 11263 and major resistance in the zone of 11342. Price surpassing the major resistance can further move towards the zone of 11420 and 11499.
Price staying below the point of control at 11184 can find minor support in the zone of 11105 and major support in the zone of 11026. Price breaking below the major support can move much lower towards the zone of 10948 and 10869.
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.
