The `Bullish Harami` candlestick pattern and other technical indicators suggest a possible change in market mood based on the current price situation - Tradebulls Securities Pvt Ltd
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The 'Bullish Harami' candlestick pattern and other technical indicators suggest a possible change in market mood based on the current price situation. The pattern is forming close to the 24,760-support zone, and a verified close above 25,140 could indicate an upward rise towards 25,740, presenting a buying opportunity. The 60-minute chart's positive price-RSI divergence is a clear sign that the recent rise may be more than a brief rebound; rather, it might be a potential trend reversal. It is noteworthy and indicates increasing strength that the index has returned over the 25,000 thresholds. The fact that the index has moved back above the 25,000 mark is significant and suggests growing strength. The ADX is 38, and the RSI is 43, suggesting room for momentum improvement. If the index can sustain its position above 25,000, short covering could trigger, especially since options data indicates upward pressure. Given these early signs of a trend reversal but lacking full confirmation, it would be prudent for momentum traders to adopt a cautious strategy. In this situation, it may be prudent to hold a combination of long and short positions while awaiting additional signs. Longer-term investors might also start building positions at the demand zone, which extends down to 24,500, in preparation for the resumption of a broader bullish trend. Although the immediate view is cautiously optimistic and backed by strong technical signs, additional evidence is needed to fully validate a trend reversal.
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