Market Overview: Nifty 50 Futures
Nifty 50 Measured Move Target of the Wedge Overshoot. The market had a small bullish close with tails on both ends in September. It continues to trade in a strong bull trend with no significant signs of reversal so far, meaning traders should avoid shorting the market or exiting their long positions. The market has reached the measured move target of the wedge overshoot, so some bulls may take profits, possibly leading to a small pullback. On the weekly chart, Nifty 50 has formed a strong bearish bar this week, covering the previous three bullish bars. Bears will need a follow-through bearish bar for a potential reversal.
Nifty 50 futures
The Monthly Nifty 50 chart
- General Discussion
- The market is currently trading in a strong bull trend, with no clear signs of a reversal. Therefore, traders should avoid shorting the market until there are strong consecutive bear bars.
- Since the market remains bullish, traders who have not yet entered this trend can place a buy limit order at the low of a bull bar.
- Traders who are already in a long position should continue holding, as there have been no signs of reversal so far.
- Consider this idea: «You should exit your long positions only when you’re ready to take a short position.» In other words, exit your long positions only when the market shows a clear attempt at a strong reversal.
- Deeper into Price Action
- Over the past several months, bears have failed to form a significant bear bar (there has been only one weak bear bar in the last year). This indicates that the market is in an extremely strong bull trend.
- For bears to reverse this trend, they must form strong consecutive bear bars. A single weak bear bar or a weak pullback will not be enough to reverse this powerful bull trend.
- Patterns
- The market has reached the measured move target of the wedge overshoot pattern. Profit booking around this level might cause a bear close
The Weekly Nifty 50 chart
- General Discussion
- The market is currently trading in a bull channel after forming a strong bear surprise bar. This week, the market closed with a very strong bear bar.
- For the bear trend to reverse the bull trend, bears need to follow through with more strong bars. Traders holding long positions should wait for this follow-through bar. If the next bar is weak, they can continue to hold their longs, but if the bears produce another strong bear bar, it may be time to exit.
- Traders who have not yet entered this bull trend can buy on a high-1 setup if the next bar turns out to be a bull bar.
- Deeper into Price Action
- In the past several weeks, the market has been unable to produce strong consecutive bear bars. If the bears manage to form another bear bar, the chances of entering a trading range will increase.
- Given that the bull trend is still very strong, the probability of this surprise bar causing a reversal without a second leg up is low. Traders can expect a second leg up before a potential reversal occurs.
- Patterns
- The market has formed a large, strong bear surprise bar. If the bears fail to follow through with another strong bar and the market reverses, a measured move up based on the height of the surprise bar can be expected.
Market analysis reports archive
You can access all weekend reports on the Market Analysis page.