aks85

NIFTY- Negative Reverse Divergence, Resistance at 50 sma- Sell

Short
NSE:NIFTY   Nifty 50 Index
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3
As seen, Nifty has been consolidating in a rectangular channel facing resistance at at 50 SMA in the daily chart .
Also, there is negative reverse divergence. Negative Reverse Divergence is when price makes lower high and RSI makes higher high, which implies that even though RSI is strengthening and making a higher high , price fails to break its previous high and forms a lower high, making it bearish .
Expecting a move towards the lower band of the channel.

Expected Levels- 8140, 8100, 8060
Exit- above high of today's candle- 8220.

I would be bullish only on the break of the top of the channel on closing basis for near term target of 8500, which would be a double bottom pattern breakout.
Trade closed: stop reached: sl trigerred.

Comments

ok boss. thank u for your clarification
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great sir.. it is a fun to learn concept.. never heard about this negative reverse divergence.. to give strength to your view, there is a bearish hanging man on the top of the swing.
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aks85 seshuram
@seshuram, Hi. Negative reverse divergence is very powerful and effective. In my opinion, it is not a hanging man because in a hanging man the lower shadow should be atleast twice the length of the real body, which is not in this case. In one of my previous ideas I have explained about an ideal hanging man, you might want to check it once. Thanks, for your suggestion though.
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