Nifty Analysis for 7th Jan'25
To analyze the Nifty 50 daily chart, I'll provide a detailed analysis based on key technical frameworks:
1. Support and Resistance Levels
-
Support Level:
- Immediate support at 23,630 (as shown on the chart and marked by the horizontal blue line).
- Secondary support around 23,000 based on previous swing lows.
-
Resistance Levels:
- Immediate resistance at 24,050.
- Next major resistance near 24,500.
2. Elliott Wave Theory
- The chart shows a possible corrective wave in progress. If the ongoing wave completes a correction (e.g., Wave C), a potential upward impulsive wave (Wave 5) might begin.
- For confirmation, monitor for a breakout above 24,050, signaling the start of a bullish trend.
3. Fibonacci Ratios
Assuming the last major swing high is around 24,500 and the swing low is 23,000:
- Key Levels:
- 23.6% retracement: 23,860 (minor resistance).
- 38.2% retracement: 24,030 (key resistance).
- 61.8% retracement: 24,310 (major resistance).
4. Gann Angles
- Nifty appears to be respecting its downward Gann angle.
- A break above 24,050 may invalidate the bearish trend and push it toward higher levels like 24,500.
5. Pivot Points
Based on daily pivot point calculations:
- Pivot Point: 23,800
- Resistance 1 (R1): 24,050
- Resistance 2 (R2): 24,310
- Support 1 (S1): 23,450
- Support 2 (S2): 23,200
6. Trendline Analysis
- A downward-sloping trendline is visible, connecting lower highs.
- A breakout above 24,050 would signal a reversal of the downward trend.
- Price currently consolidates near the support level, suggesting potential accumulation.
Trading Strategy
Bullish Strategy:
- Entry: Above 24,050, confirming a breakout with volume.
- Target:
- First target: 24,310 (61.8% Fibonacci level).
- Second target: 24,500 (swing high).
- Stop Loss: Below 23,800.
Bearish Strategy:
- Entry: Below 23,600, confirming a breakdown.
- Target:
- First target: 23,200.
- Second target: 23,000.
- Stop Loss: Above 23,800.
Risk Management
- Use a 1:2 risk-reward ratio for trades.
- Adjust the stop loss based on volatility (e.g., using ATR).
Summary
- Nifty is currently at a critical support level (23,630). A breakout above 24,050 could signal bullish momentum, while a breakdown below 23,600 would favor bears.
- Monitor volume and candlestick patterns (e.g., bullish engulfing or hammer for upward momentum).
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