Chart Pattern Analysis
The market is currently in a critical zone at 24,349.20, with the RSI severely oversold at 16.67. This setup presents both opportunities and risks for Monday’s trading session.
Strategic Approach
There are three distinct scenarios:
1. Long Trade Setup - Entry above 24,440 with targets at 24,550 and 24,650
2. Short Trade Setup - Entry below 24,230 with targets at 24,080 and 23,950
3. No Trade Zone - Between 24,230-24,440 where whipsaws are likely
Market Context Factors
The strategy incorporates several bearish headwinds affecting Nifty:
• Six consecutive weeks of decline
• FII outflows of ₹15,951.68 crore
• US tariff concerns
• Mixed earnings results
However, the extremely oversold RSI condition suggests potential for a technical bounce, making the breakout scenario viable.
Volume Confirmation with RSI
RSI of above 70 or below 30 os crucial to confirm breakout or breakdown to be considered valid. This helps filter false signals that are common in consolidation phases.
The market is currently in a critical zone at 24,349.20, with the RSI severely oversold at 16.67. This setup presents both opportunities and risks for Monday’s trading session.
Strategic Approach
There are three distinct scenarios:
1. Long Trade Setup - Entry above 24,440 with targets at 24,550 and 24,650
2. Short Trade Setup - Entry below 24,230 with targets at 24,080 and 23,950
3. No Trade Zone - Between 24,230-24,440 where whipsaws are likely
Market Context Factors
The strategy incorporates several bearish headwinds affecting Nifty:
• Six consecutive weeks of decline
• FII outflows of ₹15,951.68 crore
• US tariff concerns
• Mixed earnings results
However, the extremely oversold RSI condition suggests potential for a technical bounce, making the breakout scenario viable.
Volume Confirmation with RSI
RSI of above 70 or below 30 os crucial to confirm breakout or breakdown to be considered valid. This helps filter false signals that are common in consolidation phases.
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.
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.