Market Overview: Nifty 50 Futures
Nifty 50 Wedge Breakout on the monthly chart. The market showed strength this month with a robust bull bar closing near its high, marking a strong bull breakout of the wedge top. The Nifty 50 on the monthly chart continues in a strong bull trend, so bears should refrain from selling unless the market forms consecutive strong bear bars. On the weekly chart, Nifty 50 is within a powerful bull micro channel and has a bull breakout gap, suggesting a potential measured move up.
Nifty 50 futures
The Monthly Nifty 50 chart
- General Discussion
- The market presents two consecutive strong bull bars in a bull trend, advising against bear selling.
- Bulls can consider buying the close of the strong bull bar, given the high likelihood of a second leg up.
- While very strong consecutive bull bars late in a trend may hint at a buy climax, buying remains reasonable. Conservative traders may await a high-1 or high-2 signal bar.
- Deeper into the Price Action
- The failure to produce strong consecutive bear bars indicates bears are struggling to initiate a reversal.
- As the market nears the significant round number 22000, acting like a strong magnet, a successful bull breakout of the wedge top requires a follow-through bar.
- If bears manage a strong bear bar, the chances of a buy climax increase.
- Patterns
- The market, previously in a wedge top pattern, has successfully undergone a strong bull breakout.
- Typically, the odds of a successful bull breakout from a wedge top are 25%, necessitating a robust follow-through for success.
- Failure to achieve a strong follow-through may lead to a measured move down based on the recent bull bars’ height
The Weekly Nifty 50 chart
- General Discussion
- The market, within a bull micro channel with an open breakout gap, advises bears against selling until a strong reversal attempt occurs.
- Bulls, in this bull micro channel, can enter by placing stop orders at the high of bull bars or limit orders at the bars’ lows, given the high chances of a second leg up before a major reversal attempt.
- Long-position holding bulls should maintain their positions until consecutive bear bars form.
- Deeper into Price Action
- The breakout gap suggests a measured move up, calculated by moving a distance equal to the height from the bottom of the leg to the middle of the breakout gap.
- Patterns
- The market’s presence in a bull micro channel indicates that the low of each bar is greater than the low of the previous bar. Note: While there can be bear bars in a bull micro channel, the only rule is that each bar’s low is higher than its predecessor.
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