Reigning The Nifty - 23rd June , 2009

Nifty Half Hourly Chart

Today was a down day which stayed down till the end of trade conveying the selling will not stop soon. The half hourly chart shows a diamond formation .

The diamond pattern is basically a complex head-and-shoulders top with a V-shaped neckline. It is not a common pattern. It rarely occurs at bottoms. That is to say, it is a very bearish pattern. The target of this pattern is calculated by measuring the distance between the high and low of the pattern. This gives us a 145 point move (4352-4207). The target would be 4110 which coincides with 4116, the 50% retracement level of rise from 3534 to 4693 marked on the chart.

The Daily charts show a bearish engulfing candle though not a very huge one. The oscillators are weak and moving down in sell mode. The stochastic though has turned up from extreme oversold level and about to give a crossover with its signal line.

The low of 4207 was however held.Below this we have strong support of 4092 , the level till which nifty corrected after the huge rise after election result day. The Bull in me says we should find support at these levels.

Happy Trading !!

Lakshmi Ramachandran
www.vipreetsafetrading.com