Diamond Pattern Modified. Support Line (White) drawn from the Nifty Low of 10000 made on 26th October and touching other lows that price made during contraction towards the Diamond Apex.
On 14th Jan Monday.. What we witnessed was a False Breakout on Downside. Price Broke 10700 level in Intraday but bounced back in later half to close above the support line....
Nifty Price is trading at the APEX of the 'Diamond Top Pattern' or 'Symmetrical Triangle Pattern' on the verge of breakout. Breakout can come any side. But if we consider the Negative divergence in the CCI Indicator (20), then most likely the breakout should be on the downside. Confirmation will be an End of Day(EOD) closing below 10745-10765 support zone.
Forming a short term base around 520-530 levels.
It can bounce till 685-710 levels to test the upper resistance trendline of the falling wedge.
Weekly close above 710 can will mean a breakout of the falling wedge pattern... which will open upside target upto 800 / 850 / 900.
There is a Head and Shoulder breakout and Weekly Support trendline breakout in DLF at 165-160.
Now weekly support trendline is acting as resistance as it failed to cross above it.
Stop loss - 165/170
Target - 120 / 100 / 80
Positional View. Timeframe 3 to 5 months.
On 8th October it was published that Nifty may give a relief rally upto 10750 (Refer to the link below). The Index opened gap up on wednesday 17th Oct and made an high of 10710, just short of 40 points of our pullback target of 10750. Bears tookover the dalal street again after 6 trading sessions to give a closing at 10453 i.e. -257 points from highs.
Last week we witnessed some intense selling. Nifty Lost close to 800 points in just 3 trading sessions. Now what next...!? Normally after such intense selling there is a pullback or a dead cat bounce. Also some key factors in the coming week which can trigger a pullback can be Cool off in Crude Prices, USD INR and Improved Q2 earnings from heavyweights like TCS,...
Nifty Spot as on 4th Oct - 10599
The momentum of selling pressure, global sentiments and macros indicate that, this is the start of the NEXT BEAR PHASE...!!
Important Support Levels as on Monthly Chart are mentioned on the chart above.
Bulls Need to give a Monthly Closing above 10400 to avoid break of the bull run trend line from Feb '16 to Aug '18.
Nifty will test the channel support around 10800 and likely break it to test it's 200 DEMA at 10770. Important Resistance Levels (purple) and Support Levels (Green) are marked above in chart.
Trade Setup :-
Short @Cmp or in 10900-930 zone
Stop loss 10985
Target of 10800 / 10770 / 10750 / 10735
All the levels mentioned above are spot.
Nifty is resting at support of 10820-50.
Global sentiments like Rising Crude, Depreciating Rupee, Rising Bond Yields and not to forget Trump threatening to impose sanctions on India are the major reasons of such big selloff.
These negative sentiments will shift Nifty lower towards its 200 days exponential moving average(DEMA) placed at 10770. As per Options...
200 Days Exponential Moving Average is placed around 10770. Further the trend line support around 10800-820 is the key, from from Nifty bounced on 1st October.
If these support levels break then big selloff will be there. Lower levels of 10600/10400 also possible.
But if these key support levels hold then a good bounce till 10170/10250 possible.
Positive divergence in MACD and bounce from trend line support indicates of a possible bounce back. Expect good short covering if Nifty sustains above 11040.
For detailed resistance and support levels, refer to my under linked analysis of 15 Minutes Nifty Chart (Click on the chart to open)
On 1st Oct Nifty bounced from the trend line support around 10800 and managed to cross 10930 resistance, also testing 11030-40 resistance level but eventually closed below it. Considering the overall sentiments (Crude above 85, USDINR around 73.5, Hangseng down 900 points) nifty is likely to open lower on 3rd Oct.
Nifty will find immediate support at :-