Market Overview: Nifty 50 Futures
Nifty 50 Breakout but Weak Breakout Bar on the weekly chart. This week, the market gave a breakout of the bear micro channel. However, the bulls failed to secure a strong close on the breakout. To confirm the breakout as successful, they now need a strong follow-through bar. On the daily chart, Nifty 50 is currently trading near the top of the range, which may provide traders with an opportunity to enter a short position.
Nifty 50 futures
The Weekly Nifty 50 chart
- General Discussion
- Traders who entered a long position at the open of this week may continue holding until the next close. If the next week’s close forms another bear bar, traders should exit their positions; otherwise, they can continue holding.
- Traders who shorted while the market was trading inside the bear channel may keep holding their shorts with a stop set at the high of the current bar (this week’s bear bar). If the bulls manage to get a strong bull close, traders should consider exiting their shorts.
- Traders not currently in any position can enter a short scalp at the low of the bear bar. This is because the probability of at least a small second leg down is high due to the strength of the bear channel.
- Deeper into Price Action
- This big gap can be considered as a strong bull bar. However, it still needs a follow-through bar for a successful bull breakout.
- This week, the market formed a bear bar with a long tail at the top, while the prior week formed an inside bar. This indicates an increasing trading range price action, so traders should manage positions like scalps rather than swings.
- Patterns
- The market has given a bull breakout of the bear micro channel. If the bulls can secure a follow-through bar, the market might make a measured move up based on the height of the channel.
The Daily Nifty 50 chart
- General Discussion
- Traders who are not in any position may enter on the next open, as the market is trading near the upper half of the trading range.
- If the market opens near the bottom or lower half, traders should consider waiting for it to reach the trading range bottom before structuring a trade.
- Deeper into Price Action
- This week, the market almost reached the measured move based on the breakout gap. Traders who entered long because of the breakout gap should exit their trades, as the market trapped the bulls waiting for the exact breakout gap measured move.
- Patterns
- Whenever the market forms a breakout gap, traders can calculate the measured move target of this gap based on the size of the bull leg.
Market analysis reports archive
You can access all weekend reports on the Market Analysis page.
