Market Overview: Nifty 50 Futures
The Nifty 50 futures positive gap acting like magnet with market still being in an expanding triangle, but started with a new bear channel in the daily charts, finally market gave a breakdown of a wedge.
Nifty 50 futures
The Weekly Nifty 50 chart
- General Discussion
- Increasing bearishness near the top of the expanding triangle
- If you notice 2nd bar opened below the close of the 1st bar.
- This tells us bears are slowly starting to sell the closes
- Deeper into the price action
- Bar 1 gave an bear doji close near top of the expanding triangle, this doji formed just after a bull close which clearly shows bulls losing control.
- Bar 2 is a very good follow-through bear bar closing near it’s low.
- Bulls also know this and why Bulls would start exiting from their longs and bears would be adding to their shorts
- Expanding Triangle still intact
- Positive gap acting like a magnet, which means lower prices are more probable.
- Pro Tip
- Ever wondered how can you buy low sell high in a trading range?
- What you can do is start selling closes near top of the trading range and start buying closes near bottom of the range.
- This would give a good entry point and a better Risk to Reward rather than entering on stop orders
The Daily Nifty 50 chart
- General Discussion
- Market approaching support
- Trapped bears who bought on bar 1 looking for exit
- Bulls able to get only 1 bull close in the whole week
- Deeper into price action
- Many Bears sold the high of bar 1
- Bears sold there assuming market would reverse as it was also an resistance area (clearly seen to left on chart in green)
- Many bears knew they were trapped so they scaled in their position on the inside bar close i.e. bar 2
- Following this, the next bar gapped down as the bears started selling the close of the inside bar
- Bears who wanted to exit on breakeven on first entry still not able to exit, as market did not go a tick below their breakeven price
- Market breakdown below a weak wedge
- Wedge overshoot failed and started reversing down again in a bear channel
- The reversal down after the Wedge overshoot fail is not so strong, bear bars are too small to convert bull trend to bear trend
- Probably the best bears would get is a trading range (may be a big trading range in future is expected)
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