Fibonacci Retracement
TATA POWER BEARISH DIVERGENCEThere's a clear indication of bearish divergence in this script as we can see here Price is making Higher Highs and the RSI is making lower Highs.
Also, there's a retracement pending after the 10-year breakout of the price from 2008-2010 Highs.
We can see 160 levels in the coming months for this script.
This analysis is purely for educational purposes!!!
Please do your due diligence before investing or trading in any instrument.
Nifty AnalysisNifty is currently taking support from previous week high which is near 16400 and a break below this can take nifty to 16200 which is the last support for the index post this we can see nifty at 15900-15800. On the upside resistance is at 16970 & 17200 which are also near Fibonacci levels of 0.5% & 0.618%
What is Fibonacci retracement?If you have been in the market for some time, you may have heard of “Fibonacci retracements” . Today we are going to share an informative write-up along with a few exhibits that may help you solidify your understanding of this concept.
Table of Contents:
1. What are Fibonacci levels?
2. What is the significance of retracement levels?
3. How to find retracement levels?
4. How to use the retracement levels?
Without further ado, let’s jump in!
What are Fibonacci Retracement levels?
The retracement levels are horizontal lines that indicate areas where the price could stall or reverse.
These horizontal levels can act as potential support or resistance levels.
They are based on Fibonacci numbers. Each level is associated with a percentage which means how much of a prior move the price has retraced.
The retracement levels are 23.6%, 38.2%, 61.8%, and 78.6%.
While 50% is not a pure Fibonacci ratio, it is still used as a support and resistance. This is because people regard it as an important level.
The price won’t always bounce from these levels. They should be looked at as areas of interest. Hence, the Fibonacci retracement should be used as a confirmation tool.
Significance of Fibonacci Retracement levels
Different traders use this tool differently but the most common usage is as follows:
Place entry orders
Determine stop-loss levels
Set price targets
For example, A stock may be in an uptrend. After a move up, it retraces to the 61.8% level. Then, it starts to go up again. Since the bounce occurred at a retracement level during an uptrend, long positions can be initiated with an optimal stop loss.
Finding Fibonacci Retracement levels
In order to find the retracement levels, you have to identify the recent significant swing high and swing low and then plot the Fibonacci accordingly.
For uptrend: First, select the swing low and then the swing high.
For downtrend: First, select the swing high and then the swing low.
Exhibit: Fibonacci retracement in an uptrend
Exhibit: Fibonacci retracement in a downtrend
How to use the retracement levels?
If the price is approaching a Fibonacci level, you should look out for the following things at the point of interaction or in the vicinity of the level.
Reversal candlestick patterns
Rising volumes
Moving average
RSI divergence
Previous support/resistance level
Conclusion:
Adding Fibonacci analysis with other common methods of technical analysis can be useful for adding confluence to a trade.
Thanks for reading! Hope this was helpful!
See you all next week. 🙂
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Banknifty strongest Wave 3 of Fall to startBanknifty recovered up after fall from 34820. Currently wave 2 of zig zag in progress.
Risky option would to go short near 34700 with SL 34820 or can wait for confirmation break of 34530 for downside fall minimum target 34000.
Wave 3 will go beyond 1.618 fibonacci extensions level. Channel break needed for sharp fall so watch as plotted on chart.
DISCLAIMER:There is no guarantee of profits nor exceptions from losses.
Technical analysis provided on the chart is solely the personal views of my research.
You are advised to rely on your own judgments while taking any investing/Trading decisions.
Past performance is not an indicator of future returns. Investment/trading is subject to market risks.
Seek help of your financial advisors before investing/trading.
Not recommended to take FnO positions based on this analysis
I may or may not trade this analysis. Details in description.
LT getting ready for a big move up?LT gave a good breakout of the trendline & is now on its way back down to retest the trendline. The ideal place to buy will be between 1585-1600 as it is also the retracement into the fib golden zone of its last move up. the recent import duty cuts on raw materials like Iron & levy of export duty on steel products should also be of benefit to the stock.
ASHOK LEYLAND: Upward TrendNSE:ASHOKLEY shows strong buy indicated by PSAR, MACD & Fisher crossover followed by EMA & MA Crossover
Target 2: 149.15
Target 1: 134.20
Stop Loss: 118.65
𝑫𝒊𝒔𝒄𝒍𝒂𝒊𝒎𝒆𝒓:
The analysis is only for illustration purposes only. Please consult your financial advisor, agent, broker before acting on any information. We may or may not have positions in the stock and our actions may be contrary to the one mentioned here. This analysis may or may not be updated. We would not be responsible for the profit/loss resulting from this analysis.
McDowell Long opportunityNSE:MCDOWELL_N
Stock -> United Spirits (McDowell)
TimeFrame -> Weekly
Hello all!
United Spirits broke out of the symmetrical triangle pattern on 27 September 2021. The stock since then has been consolidating ever since thus forming a flag and pole pattern and has now finally come to retest the triangle it broke out of. It makes for a good opportunity to go long.
The perfect entry would be after the breakout of the flag pattern. The stock is also nearing its "Golden zone" (between 50%-61.8% Fibonacci retracement) . Thus accumulation in small quantities can also be done at this point.
The analysis would become invalid if the flag pattern is broken on the downside.
*NOT A CALL*
#mcdowell #unitedspirits #nifty #fibonacciretracement #technicalanalysis #swingtrading
TATA ELXSI: POSITIVE TRENDNSE:TATAELXSI shows strong buy indicated by PSAR, MACD & Fisher crossover followed by EMA & MA Crossover
Target 2: 8345.00
Target 1: 8200.80
Stop Loss: 8052.0
𝑫𝒊𝒔𝒄𝒍𝒂𝒊𝒎𝒆𝒓:
The analysis is only for illustration purposes only. Please consult your financial advisor, agent, broker before acting on any information. We may or may not have positions in the stock and our actions may be contrary to the one mentioned here. This analysis may or may not be updated. We would not be responsible for the profit/loss resulting from this analysis.
GUJARAT AMBUJA EXPORTS: Long term positive outlook NSE:GAEL shows strong buy indicated by PSAR, MACD & Fisher crossover followed by EMA & MA Crossover
Target 2: 470.20
Target 1: 383.50
Stop Loss: 286.85
𝑫𝒊𝒄𝒍𝒂𝒊𝒎𝒆𝒓:
The analysis is only for illustration purposes only. Please consult your financial advisor, agent, broker before acting on any information. We may or may not have positions in the stock and our actions may be contrary to the one mentioned here. This analysis may or may not be updated. We would not be responsible for the profit/loss resulting from this analysis.
Hindustan Unilever long opportunityNSE:HINDUNILVR
Stock -> Hindustan Unilever
TimeFrame -> Weekly
Hello all!
Hindustan Unilever has corrected about 40% from its highs in September 2021. The stock has been in a downtrend since then and has been taking stiff resistance from trendline 1. It approached its strong support band of 1850-2000 and took a strong bounce from there with good volumes and also broke trendline 1. The retest of the trendline has been done and its followed by a bullish candle. This thus makes for a good opportunity to go long.
Apart from the price action, the stock also seems to be taking support from its 200 weekly EMA. Also the bounce has come from the 50% fib level which further strengthens the conviction on going long.
NHPC LTD: GROWTH TREND NSE:NHPC shows strong buy indicated by PSAR, MACD & Fisher crossover followed by EMA & MA Crossover
Target 2: 37.60
Target 1: 34.85
Stop Loss: 29.05
𝑫𝒊𝒔𝒄𝒍𝒂𝒊𝒎𝒆𝒓:
The analysis is only for illustration purposes only. Please consult your financial advisor, agent, broker before acting on any information. We may or may not have positions in the stock and our actions may be contrary to the one mentioned here. This analysis may or may not be updated. We would not be responsible for the profit/loss resulting from this analysis.