Wednesday, March 7, 2018

Nifty breaks Head & Shoulder Neckline

After long I am writing on Nifty. There is a reason to do so - Nifty breaks medium term up-trend.
Nifty breaks below trend line as well as Head & Shoulder neckline.
As you can see in the daily chart below, the breakdown has come about with good volumes. Bears have a clear edge over bulls.
What can be done now-
Nifty is approaching the next support between 10100-10040. So it would not be wise to short at this moment. One can expect a bounce from the support. If the bounce comes about, Nifty can move up to its resistance near 10300-10350.

With this movement, we can assume that Nifty is in medium-term downtrend.
The same is also confirmed by the cycle change from 'higher top higher bottom' to a new cycle of 'lower top lower bottom'. The new cycle of lower top lower bottom is expected to continue for some time now.
If Nifty breaks below 10040, next major support is near 9750.

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Chart curtsy- Sharekhan Trade Tiger