Market Overview: Nifty 50 Futures
Nifty 50 Outside Bar on the monthly chart. This month, the market presented a strong bull bar closing near its high, increasing the strength of the existing bull trend. The probability of reaching the measured move of the wedge top has also increased. The Nifty 50, on the daily chart, is trading within a bull micro channel. The market has already hit the measured move based on the trading range bull breakout. This week, the market on the daily chart gave a strong bear close, so traders can expect a small pullback before the continuation up.
Nifty 50 futures
The Monthly Nifty 50 chart
- General Discussion
- Traders who are in a long position should continue holding it as the market is still in a strong bull trend, and the bears have again failed this month to give a strong bear close.
- Traders who have not entered this bull trend but want to enter can buy at the current price or place a stop order to buy at the high of this month’s bull bar.
- As bears have failed to form any strong bear bar in the past several months, the chances of a reversal are very low. Bears should hold off from selling until the market forms a strong reversal attempt.
- Deeper into Price Action
- This month, the market formed a large bull bar covering previous month’s bars, indicating strength for the bulls.
- If the market gives a strong bull breakout of the outside bar pattern, this might lead to a measured move up based on the height of the outside bar.
- Patterns
- Market gave a strong bull breakout of the wedge top. This results in a measured move up based on the height of the wedge top.
The Daily Nifty 50 chart
- General Discussion
- The market is trading in a bull micro channel, so bears should not be selling. Traders should wait for the market to form strong consecutive bear bars before selling.
- The market is in a strong bull trend, but this week it has formed a strong bear bar closing near its low. Bulls can place a buy stop order at the high of this bear bar or wait for a pullback and buy on a high-1 or high-2 setup.
- Deeper into Price Action
- Notice that the bull bars in the bull micro channel have very short tails on either end, indicating strength.
- As the current bull leg is strong, the chance that bears will be able to cause a reversal in the next leg before a second leg up is very low.
- There is at least a 60% chance that the market will form a second leg up before any reversal.
- Patterns
- A bull micro channel is characterized by a specific pattern. It occurs when the low of the preceding bar is lower than the low of the subsequent bar.
- If the bulls manage to achieve a bull breakout of the micro double top, this could result in a measured move up based on the height of the micro double top.
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