Market Overview: Nifty 50 Futures
Nifty 50 High-1 Signal Bar. This week, the market showed a strong bullish trend, closing near its high after a minor pullback. It’s currently trading within a narrow bullish channel and is progressing towards the projected target of the outside bar pattern. On the daily chart, Nifty 50 is indicating a potential double top formation following a robust bullish trend. However, if the market instead forms bearish bars without breaking above the double top, it could signal the beginning of a bearish channel.
Nifty 50 futures
The Weekly Nifty 50 chart
- General Discussion
- The market is trading in a strong bull trend and has not formed any significant bear bars in recent weeks. Bulls holding long positions should continue to maintain their positions.
- Traders who have yet to enter this bull trend can consider entering on the high of the latest bull bar on the weekly chart. Bears attempted a pullback but only managed a minor one, forming a high-1 signal, presenting a favorable buying opportunity.
- Bears should refrain from selling as they have been unable to initiate a substantial pullback, indicating their weakness. Additionally, bears have failed to produce consecutive bear bars over the past several weeks.
- Deeper into Price Action
- The market is currently trading within a narrow bull channel, limiting opportunities for bears to profit. Bulls are advised to add to their long positions near the bottom of this tight bull channel.
- The market is also targeting the measured move of the outside bar pattern. Furthermore, the significant psychological level of 25000 is nearing, which is likely to attract market movement like a magnet.
- Patterns
- The market is presently forming a tight bull channel and approaching the measured move target from the outside bar bull breakout.
- Traders should note the approaching significant round number of 25000, which could influence price behavior. Holding long positions until the market approaches this level is advisable.
The Daily Nifty 50 chart
- General Discussion
- Traders holding long positions should maintain their positions as the market is currently in a robust bull trend, with bears failing to form consecutive strong bear bars.
- Traders looking to enter this bull trend can wait for a bull breakout of the double top formation.
- Alternatively, if the market trades within a bear channel instead of breaking out bullishly from the double top, bears can sell near the channel’s top and exit near its bottom.
- Deeper into Price Action
- Bears attempted a market reversal with a strong bear bar but lacked follow-through, resulting in a small bull bar following the large bearish one.
- Until bears demonstrate sustained strength with consecutive bear bars, traders should avoid swing bear positions and instead focus on buying opportunities.
- Patterns
- If bulls successfully break out above the double top formation, traders can hold their long positions until the market reaches the measured move target based on the pattern’s height.
- Some traders may hesitate to enter the bull breakout due to potential large stop losses after a significant bull bar. In such cases, entering on a high-1 pattern post-bull breakout can offer a smaller stop loss and higher success probability. However, be prepared to miss the opportunity if the market fails to pull back and continues towards its target.
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