6 Months correction and Pennant pattern Chart:-
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All trends are down and Nifty is trading below 200 Day EMA for the last 8 sessions between 5444-5605. As nifty sustained below 200 Day EMA therefore Long term trend also turned down but it has to be decided that Indian markets have moved into bearish phase or not and following points have to be considered also for the confirmation of bearish phase:-
1- Wave-4 has completed'ABC' correction.
2- Continuation Pattern Pennant Formations in last 6 months. As Pennant is continuation pattern and on going trend is upward therefore it should remain continued according to the impact of continuation pattern formations.
3- Wave-5 is on and Rising Trend Line of Pennant is Wave-5 Trend line.
4- Nifty is trading exactly at Rising Trend Line of Pennant/Wave-5 Trend line for the last 8 sessions between 5442-5605.
Conclusions (After Putting All Studies Together)
Nifty-Micro Analysis of Intra Day Chart(13-05-2011)
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Nifty traded and covered almost whole of the last 8 sessions trading range and traded between 5472-5605 on 13-05-2011,Main features of are as follows:-
1- Support exists between 5450-5475 exactly below the trading range of 13-05-2011
2- Intraday Support between 5475-5495 on 13-05-2011
3- Intraday Support between 5542-5562 on 13-05-2011
4- Intraday Resistance between 5590-5605 on 13-05-2011
5- Intraday Support between 5530-5545 on 13-05-2011
Next Trend Deciding 8 Sessions Range(04-05-2011-13-05-2011) Chart:-
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Nifty traded between 5444-5605 in last 8 sessions,this range break out and sustaining beyond will decide that Indian markets have moved into Bearish phase or Bullish markets hopes are alive. Sustining below 5444 will be confirmation of Bear phase and deeper lower levels possibility. Sustaining above 5605 will mean revival of Bullish markets hopes,its confirmation points will be discussed after sustaining above 5605.
As Petroleum rates hike and weak US markets last Friday therefore weak weekly opening and firstly trading between 5444-5605 expected and above mentioned supports may be tested but final weekly view should be formed from sustaining beyond 5444-5605. Weak sentiment and negative zone trading expected in the begining of week but supports also at lower levels therefore fresh selling patterns are must for any move below 5444. As 5th wave trend line and Rising Trend Line of Pennant are still intact therefore up moves hopes are alive and next views will be formed from coming couple of sessions intraday charts patterns and 8 days range break out.
Until Nifty is Range bound till then Stop Loss should remain beyond range with targets within range and directional trades should be initiated after range break out confirmations.
