Nifty Continued with is volatility throughout the week but Evening star pattern on Weekly charts and Bearish Engulfing pattern on daily chart which i mentioned in my last post : “Nifty near to triple Support” are still Valid. Additionally , Two supports out of three which were crucial for the week has been breached on Friday and markets have closed below the same. The third support has been void as the channel is no more intact on daily chart.
So as marked in the graph Nifty has confirmed weakness by closing below 20 Day SMA and also the closing below the support line which was intact since January this year. Indicators have finally lost buying momentum and are now showing some support for the sellers in near time. On weekly charts too we have seen consecutive two red candles and failure of bulls to false out Evening star patter which was formed during initial weeks of June. So overall trading mood is weakening but stock specific buying momentum should continue on Street.
Now lets study weekly charts for the downside possibilities as we had seen a strong rally in recent past. Evening Star pattern is still intact but still we havent got confirmation for the pattern. Whats the confirmation ?…A trade and close below 9550 on Week on Week basis. Looking at last two weeks Red candle it seems we are all set to break that support this week. For the support on the downside, have considered Fibo which gives probable target zone to 9225-9317 while its coinciding with Elliot wave 4th Wave support at 9227!
To sum up , am still bearish on markets for Short term trade and strategy remains the same as i mentioned in my last post….. “strategy for traders would be buying 9500 PE and selling 9700 CE for tgt of 9300!”
Rd disclaimer before investing.