Nifty Reversal Watch: Key Demand Zones & Moving Average in FocusAs a pure technical analyst, I rely solely on what the charts reveal, ignoring the noise of news and fundamentals. Charts tell the story in advance.
As a demand and supply zone trader, my primary focus is on identifying key areas where institutional activity is likely to drive price action. Today, we’ll analyze the Nifty 50 through the lens of demand zones and then complement it with traditional technical analysis using moving averages. This analysis aims to provide clarity on potential reversal zones and market behavior.
📊 Demand Zones: The Foundation of Analysis
Monthly & Quarterly Demand Zones : On the monthly timeframe, I’ve identified a critical demand zone. When we zoom into the quarterly timeframe, this zone aligns perfectly, creating a high-confluence area. These zones represent institutional footprints (Banks, mutual funds, etc. ), indicating where smart money is likely to step in. These are not just traditional lines or boxes on the chart; they are the footprints of institutions that control the market.
Significance of Demand Zones : Demand zones are areas where buyers are expected to dominate, often leading to price reversals. The confluence of monthly and quarterly demand zones increases the probability of a strong support level.
Current Price Action : Nifty is currently hovering near these demand zones, suggesting a potential bottom formation.
📊 Traditional Technical Analysis: Moving Averages
Now, let’s analyze the market through the lens of traditional technical analysts who rely on moving averages.
EMA 20 on Monthly Timeframe : The 20-period EMA on the monthly chart acts as a reliable support level historically. Since 2004, price reversals have consistently occurred near this moving average, marked by green circles on the chart.
EMA 20 as a Magnet : The EMA 20 on the monthly timeframe is equivalent to the 400-period EMA on the daily timeframe, representing the average price of almost 400 days. In trending markets, price always reverts to its average, making this a critical level to watch.
Historical Exceptions : While there are rare instances (marked by red circles) where Nifty has broken below the monthly EMA 20, the presence of demand zones adds an extra layer of support, reducing the likelihood of a significant breakdown.
Current Price Action : Nifty is currently near the monthly EMA 20, which coincides with the monthly and quarterly demand zones.
📊 Combining Both Approaches
High-Confluence Area : The alignment of monthly and quarterly demand zones with the monthly EMA 20 creates a high-confluence area. This increases the likelihood of a strong support level and a potential Bottom.
Risk Management : While the setup appears promising, it’s crucial to manage risk effectively. Always use strict stop-loss orders and avoid over-leveraging. Even high-probability setups can fail, especially when market sentiment is overwhelmingly negative.
📊 Conclusion
The Nifty 50 is at a critical juncture, with multiple technical indicators pointing towards a potential reversal or consolidation. The confluence of demand zones and the monthly EMA 20 provides a high-probability setup. However, always remember that no setup is foolproof, and risk management is crucial, it’s essential to remain cautious as markets can sometimes defy all technical setups.
This analysis is purely for educational purposes and is not intended as trading or investment advice. I am not a SEBI-registered analyst.
Lastly, thank you for your support.
"The market is a master of patience; trade with discipline, not emotion." 🚀📊
Moving_average
Balkrishna Industries (BALKRISIND) Monthly Chart AnalysisThe technical setup combines Fibonacci retracements, trendlines, and moving averages to reveal key insights into future price action.
The following analysis covers key support and resistance levels, bullish and bearish scenarios, and potential trade opportunities.
Trend Overview :
The stock is in a long-term uptrend, supported by a rising trendline that has acted as a strong base.
Recent corrections indicate a healthy retracement within this uptrend.
Fibonacci Retracement Levels :
The Fibonacci retracement is drawn from a major swing low to swing high.
Key levels:
23.6% at 3,096.30.
38.2% at 2,966.30 (currently breached).
50% at 2,785.30 (tested as support).
61.8% at 2,605.30 (a critical level for buyers).
78.6% at 2,466.30 (final support zone).
Support Zones :
Primary Support: 50% retracement at 2,785.30 coinciding with EMA-21 (~2,661.59).
Secondary Support: 61.8% retracement at 2,605.30 aligned with a consolidation zone.
The long-term trendline also intersects around these levels, adding confluence.
Resistance Zones :
Immediate Resistance: 23.6% retracement at 3,096.30.
Strong Resistance: Previous swing high near 3,374.30.
Psychological resistance at 3,500.
Exponential Moving Averages (EMAs):
EMA-9 at 2,850.54 is currently supporting the price.
EMA-21 at 2,661.59 aligns with the 50% Fibonacci level, acting as a critical support zone.
The EMAs are in a bullish crossover, indicating long-term strength despite short-term corrections.
Volume Analysis :
Monthly volumes are consistent, with higher volumes during bullish candles, signaling strong institutional interest.
The recent pullback has seen declining volumes, suggesting a lack of aggressive selling.
Bullish Scenario :
If the price holds above the 50% retracement (2,785.30) and regains 3,096.30, the uptrend could resume.
Breakout above 3,374.30 may lead to new all-time highs, targeting 3,826.20 as per the Fibonacci extension.
Bearish Scenario :
A breakdown below the 61.8% retracement (2,605.30) and the long-term trendline could invalidate the uptrend.
Further downside could target the 78.6% retracement at 2,466.30 and psychological support at 2,400.
Trade Plan
For Bulls :
Entry: Near 2,785.30 (50% retracement) with confirmation of reversal signals.
Target 1: 3,096.30 (23.6% retracement).
Target 2: 3,374.30 (previous high).
Target 3: 3,826.20 (Fibonacci extension).
Stop Loss: Below 2,605.30 (61.8% retracement).
For Bears :
Entry: On breakdown below 2,605.30 with strong bearish momentum.
Target 1: 2,466.30 (78.6% retracement).
Target 2: 2,400 (psychological level).
Stop Loss: Above 2,785.30.
Analysis of intraday,intraweek Moving average stocks 19/Nov/2024Analysis of intraday, intraweek Moving average stocks 19/Nov/2024
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POKARNA going through a tight consolidation upside move possiblePOKARNA stock is going through tight consolidation in a bullish pattern on daily charts
promoter's holding is stable
FII's increased there position in this stock in September month
quater result expected good
1000 is a strong support am expecting a good upmove from this levels
entering in this stock with strict SL of close below 20 MA
**Disclaimer:** This information is for educational purposes only and does not constitute financial advice or a recommendation to buy or sell any securities. Always do your own research and consult with a financial advisor before making investment decisions.
ELIN - 1.5 Years Downtrend / Consolidation BreakoutElin Electronics Ltd
1) Time Frame - Weekly.
2) The Stock has been Consolidating since (February, 2023). Now It has given a Consolidation breakout & Closed with good volume & good bullish momentum candle in weekly Time Frame.
3) The stock may reach it's previous Life Time High (245 - 17.50% from the price 208.32).
4) Recommendation - Strong Buy.
RKFORGE - 10 Months Consolidation Breakout / All Time HighRamkrishna Forgings Ltd
1) Time Frame - Weekly.
2) The Stock has been Consolidating since (August, 2023). Now It has given a Consolidation breakout & Closed at it's Life Time High with good volume & good bullish momentum candle in weekly Time Frame.
3) The stock may find it's next resistance around the price (1100 - 22.30% from the price 899.10).
4) Recommendation - Strong Buy.
INOXGREEN - 6 Months Consolidation Breakout / All Time HighInox Green Energy Services Ltd
1) Time Frame - Weekly.
2) The Stock has been Consolidating since (January, 2024). Now It has given a Consolidation breakout & Closed at it's Life Time High with good volume & good bullish momentum candle in weekly Time Frame.
3) The stock may find it's next resistance around the price (210 - 22.90% from the price 170.82).
4) Recommendation - Strong Buy.
Radico Khaitan, Long Base BreakoutRadico Khaitan, a major alcohol manufacturer in a very long base(~200 days)
Long base = Big Breakout (check recent example Gravita India)
-Kind of Inverted Head n Shoulder too
-Good shakeout of 200 dema too
-Recovered fast from 4th june fall with good vol and price action.
EPACK - 5 Months Downtrend Breakout Epack Durable Ltd
1) Time Frame - Daily.
2) The Stock has been in a Downtrend since (January, 2024). Now It has given Downtrend breakout & Closed with good volume & good bullish momentum candle in Daily Time Frame.
3) The next resistance would be It's Previous Life Time High (224.50 - 8.90% from the price 206.10).
4) Recommendation - Strong Buy.
Thomas Cook, one simple horizontal line setupTraveling is booming in India post covid.
And travel companies are enjoying this piece of pie.
-Posted growth YoY EPS growth, OPM% also improving.
-Near Major resistance, under which it is consolidating for 50 days (good consolidation)
-Good Shakeout, when price went below major ema (here 21 dema) and rally back (also known as MAU&R: Moving Avg Undercut and Rally)
-Tightness near resisantance.
-Signal Candle (5th n 7th June candles are white dot, which is more than 5% move with 1M vol) suggesting big players are buying. Retailer buyers cant create such volumes.
If it breaks this resistance level. with good vol (basically more than 10 day avg) then can expect good move.
No buy/sell recommendations.
EQUITAS SMALL FIN BANK - Picture perfect 'W' setup w/ 40% upsideOverview & Observation:
1. Double-bottom formations.
2. Moving with W Demand.
3. EMAs support taken confirming the up trend momentum.
4. RRR is favourable
Trade Plan:
1. Entry = Marked blue line
2. SL = 6-7% Marked red line
3. TP = 40% Marked green line
- Stay tuned for further insights, updates and trade safely!
- If you liked the analysis, don't forget to leave a comment and boost the post. Happy trading!
Disclaimer: This is NOT a buy/sell recommendation. This post is meant for learning purposes only. Please, do your due diligence before investing.
Thanks & Regards,
Anubrata Ray
WTICAB - 3 Months Consolidation Breakout Wise Travel India Ltd
1) Time Frame - Daily.
2) The Stock has been in a Consolidation since (March, 2024). Now It has given Consolidation breakout & Closed at it's Life Time High with good volume & good bullish momentum candle in Daily Time Frame.
3) The next resistance would be around the price (330 - 18.15% from the price 279.30).
4) Recommendation - Strong Buy.
Multiyear breakout in ARE_M ?There is an upward trend since the beginning of 2023.
The price appears to be consistently above the 100-day moving average, which is a technical indicator that can signal an uptrend.
The trading volume appears to be increasing, which suggests that there is growing interest in the stock.
Kotak: Short term reversal (6 May onwards)On this Daily Chart, we can see that Kotak has made a recent swing low of 1546 on Friday after losing support from its 1650 level. The results were out yesterday and Kotak has announced 26% increase in profits beating the market estimates. This should potentially cause a reversal in price going forward. In the short term, price is likely to touch the 200D SMA (purple line) which also coincides with a trend line (in blue) creating an upside of about 15% from current levels.
Indicators:
1. The EPS chart shows solid growth while the P/E is almost at a decadal low of 16.9
2. The RSI has bottomed out both in the Daily and Weekly
3. The price hit the lower threshold band of Fibonacci Bollinger Band (solid green line) indicating a possible bottoming out of price
4. The price is currently below both the 50D and 200D SMA, indicating short term bearish territory
Risks: The current downtrend can also continue in the next week and the next visible support is at 1450 implying a downside of 6%
Strategy: Given the growth drivers and a ridiculous valuation of the bank, the price is sure to make a reversal in coming days. Watch for the price action on Monday, and based on lower time frame price action, take entry. If the price comes down, towards 1450 levels, it should be used as an opportunity to build more positions instead of thinking about Stop loss and exiting.
Happy Trading!