Technical Analysis for Nifty

Markets have been consolidating (or is it distribution ?) since a month and a half after the recent high of 5630 was made. With RBI policy coming out on 17-04-12 , Markets may also start to come out of this phase and show the way to a trending phase in short term.




 

We are trading in a Triangle Pattern since 5630 till date and we may be in its last leg if this pattern holds true. The leg 'E' of the pattern which is expected to end within next couple of sessions , may end as truncated or may even go down to whipsaw the lower trendline. The zone of 5120-5140 zone as shown in charts has confluence of Technical Support levels.

The details of Triangle may be as below but one should also be cautious of a bearish probability which is quite scary , shown in red counts here (1-2 ,i-ii since 5630 after an expanded flat wave X ) and was first put up apprx. a month ago - Click Here 

 

Now for Trading ahead we should have following points in mind -

1. The Trending move may begin or accelerate (if down) from Tuesday and can give good Positional Trade . 

2. The bias for short term is Down as of now, trading below all imp. averages.

3. A Buy may be initiated in 5120-40 zone if comes ,which will be counter-trend in near term , with a stoploss of 5080 on closing basis. The Buy if done is to be hedged with Put options. The part of the trade which goes right should be held or traded and other one squared off on confirmation.

4. The Shorts may part book in the support zone and carry part till reversal in lower TF confirmed. They may re-enter later if trend downwards continues. 

5. Break and close (with volumes) of the Trendline on any side will confirm the direction for positional trade . 

Have a Profitable Week ahead !!!

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