Point and figure chart analysis...!

[praveen98]

Hi Guys,
Hope every body enjoying the weekend...Let us learn about a formation called bearish catapult on NIFTY SPOT Long term chart....
Nifty took support around 8000 spot levels twice and violated the bottom third time forming a Triple bottom sell,making a fresh low @7800 falling further to a lower level of 7600 and now it rallied back to 8200 levels...You can see from the chart that there is bearish resistance@8200-8400 zone. Suppose if NIFTY turns back into a supply column and violates previous bottom(7600)making a fresh low @7400 makes the formation complete which is triple bottom break down followed by a double bottom sell is called BEARISH CATAPULT...formation....whether nifty will make the formation complete(hopefully it won't complete this formation) but there is a probability...
Bearish catapults usually leads to accelerated falls...and may lead to retesting of 6600 to 6800 zone...

Hi,
Here is the follow up to the October 11th post on Bearish Catapult formation...Nifty spot has reversed into supply column now by making day's low of 7600 yesterday...during this fall if it breaches 7400 too, it is completion of Bearish catapult formation...which may lead to correction to the levels of 6600 to 6800...(Actually the Vertical count Target on the down is @6000 to 6100...but many pnf counts don't get fulfilled...so don't panic ) My intention is to show the Bearish catapult formation while it is in formation....
The pattern is negated if Nifty makes a high of 8400...
Best Regards,
praveen:thumb:

 

[virtualtechie18]

Thank you for this.

 

[praveen98]

Hi,
Here is the follow up to the October 11th post on Bearish Catapult formation...Nifty spot has reversed into supply column now by making day's low of 7600 yesterday...during this fall if it breaches 7400 too, it is completion of Bearish catapult formation...which may lead to correction to the levels of 6600 to 6800...(Actually the Vertical count Target on the down is @6000 to 6100...but many pnf counts don't get fulfilled...so don't panic ) My intention is to show the Bearish catapult formation while it is in formation....
The pattern is negated if Nifty makes a high of 8400...
Best Regards,
praveen:thumb:

Hi,
Nifty spot completed the Bearish catapult formation on 18th January...please go through the attached image ...as this is a Long term chart it takes time to complete formation...From October2015 to Jan 2016, it took almost a quarter and a month to complete the formation...
So let us see how the Price action develops further. As of now nifty spot got support @7250 zone and bounced back to 7400 levels yester day...As i stated in my earlier post this bearish view is negated if Nifty spot makes a high of 8400 above bearish resistance line...and generates a buy signal ...Until that happens Point and figure chart view is bearish....as far as NIfty50 is concerned....
Any way my intention is to explain a Point and figure formation,Bearish catapult set up while it is in formation..that purpose is served whether this pattern will succeed or fail only time can tell...
Happy learning and Happy trading:clapping:

 

[praveen98]

Hi Guys,
Hope every body enjoying the weekend...Let us learn about a formation called bearish catapult on NIFTY SPOT Long term chart....
Nifty took support around 8000 spot levels twice and violated the bottom third time forming a Triple bottom sell,making a fresh low @7800 falling further to a lower level of 7600 and now it rallied back to 8200 levels...You can see from the chart that there is bearish resistance@8200-8400 zone. Suppose if NIFTY turns back into a supply column and violates previous bottom(7600)making a fresh low @7400 makes the formation complete which is triple bottom break down followed by a double bottom sell is called BEARISH CATAPULT...formation....whether nifty will make the formation complete(hopefully it won't complete this formation) but there is a probability...
Bearish catapults usually leads to accelerated falls...and may lead to retesting of 6600 to 6800 zone...

Hi Guys,
Hope all of you made good amount of money in the sharp fall. Here is the follow up to Bearish catapult formation...Typical to bearish catapult the fall was sharp,approximately 8% fall in a front line index in less than a month (bearish catapult completed on 18th jan) and it touched a low of 6869 yesterday 12th feb ...
There is a bearish support zone @6600 to 6800 spot nifty levels(indicated in the latest image posted) ...let's see how nifty behaves at those levels . Yesterday it rallied almost 150 points from the low ...lets see how it pans out in the coming days...if we consider fall from bearish resistance zone indicated in the quoted post on 11th october post its a very hard fall of 18% which took 5 months last 8% fall took only one month that is typical to a catapult ....:clapping:
Wish you all happy learning and happy &profitable trading...

 

[praveen98]

Hi Sherbaaz,
It can draw intra day chart also but you have to paste the data in sheet 2. I am saving data in excel sheet from NOW/NEST trading platform and then copy pasting the data from that sheet to the pnf sheet....
It seems you have assumed that it will draw intra day chart automatically....that is not the case...
To get automatic charts you can use Pi from zerodha...or use a commercial software like Define edge Trade point software , Amibroker with AFL given in the same thread in earlier pages by Lincon sir with GDFL data, Bulls eye broker5 with GDFL data or Updata Trader Pro with e Signal data....
The last one is the best choice but pricey....
Bulls eye broker5 with GDFL data costs you around 3k to 4k per month but be wary their customer support is very very bad...I have a very bad experience with them...
Define edge is technically drawing pnf charts alright but appearance wise need lots of improvement.....
I am not impressed with pi pnf chart...the AFL given in this thread draws pnf charts but i think some technical incorrectness in the charts...
If you can afford Updata Trader pro is the best ...
If you can not afford and actively trade only one instrument like Nifty futures then you can chat it manually...surprised!! yes manual charting on a graph sheet can make you understand the intricacies of the chart ...and keeps you focused.
Happy trading:thumb:

Hi,
In the above discussion for real time point and figure charting i mentioned that Updata Trader pro as the best,but costly for small trader due to eSignal data feed...Now Updata Trader Pro is also compatible with GDFL and Neo trade analytics data feeds from india. So the cost has come down to half and now it is (around 5 to 6k per month) affordable...So if any body is interested in real time pnf charting, can try Updata TraderPro with GDFL or Neo data....:thumb:
Best Regards

 

[monkeybusiness]

Hi,
In the above discussion for real time point and figure charting i mentioned that Updata Trader pro as the best,but costly for small trader due to eSignal data feed...Now Updata Trader Pro is also compatible with GDFL and Neo trade analytics data feeds from india. So the cost has come down to half and now it is (around 5 to 6k per month) affordable...So if any body is interested in real time pnf charting, can try Updata TraderPro with GDFL or Neo data....:thumb:
Best Regards

Missing your analysis, do post them as and when you have time.:thumb::thumb::thumb:

 

[praveen98]

Missing your analysis, do post them as and when you have time.:thumb::thumb::thumb:

Hi MB,
I will definitely post pnf charts and my interpretation whenever i can...These days i am trading Bank nifty futures...and with an intention to concentrate on single instrument, BNF for better focus ...stopped trading& tracking..NF...
I will post Nifty spot EOD charts and BNF intra day charts ..whenever i find interesting patterns....
Thank you:clapping:

 

[praveen98]

Hi,
This is Nifty spot Medium Term view pnf chart 50X3 High Low(Daily)....You already know the Long Term chart posted earlier is still the same and not yet shown any reversal to Demand column (X column) as Nifty spot needs to touch at least 7600 to mark a reversal of column.
My intention here is to discuss the effectiveness of 45 degree pnf trend lines and Horizontal lines of Support and resistance....
First let us see Horizontal lines of Support and Resistance...The blue dotted line marked on the chart Supported and from that price bounced back thrice acting as Support, but the fourth time it failed to hold,generated sell signal leading to a fall....The same Horizontal line which acted as Support now acted as Resistance during October rally...
Next there are two bearish resistance lines marked on the chart....Bearish resistance line drawn from August highs held price and acted as resistance during Jan rally and price straddled the line yesterday@7550 ...Let us see how the price behaves at this zone...
Bearish resistance line 2 is drawn from October highs and it is not yet tested...
And in the left hand corner there are two blue line marked as Bearish support lines...They act as probable support zones..in a down trend channel...
The brown colored lines which are not marked are Bullish resistance lines....
The use of trend lines to a trader is to assess balance of probability...so in down trend one may liquidate short positions in the zones indicated by bearish support lines and liquidating longs @ resistance lines....
So Medium Term pnf chart is advocating liquidation of swing longs initiated on Budget day or next day at these levels....but momentum is too strong to go for full liquidation can opt for part liquidation...As the chart is moving close to supply zone....
The important use of Trend lines is indication of Change in trend from Up to down and vice versa....
suppose if Nifty spot tests 7600 during this rally encounters some supply there so it forms a three tops @7600 and reverses from there to 7450 to move back up from there to break both bearish resistance lines @7650 making a higher bottom @7450 indicates change in trend...from down to Up...
BestRegards...:clap:

 

[praveen98]

Hi Guys,
Hope all of you made good amount of money in the sharp fall. Here is the follow up to Bearish catapult formation...Typical to bearish catapult the fall was sharp,approximately 8% fall in a front line index in less than a month (bearish catapult completed on 18th jan) and it touched a low of 6869 yesterday 12th feb ...
There is a bearish support zone @6600 to 6800 spot nifty levels(indicated in the latest image posted) ...let's see how nifty behaves at those levels . Yesterday it rallied almost 150 points from the low ...lets see how it pans out in the coming days...if we consider fall from bearish resistance zone indicated in the quoted post on 11th october post its a very hard fall of 18% which took 5 months last 8% fall took only one month that is typical to a catapult ....:clapping:
Wish you all happy learning and happy &profitable trading...

Hi,
Follow up on Long term chart of Nifty spot as the Nifty reversed into Demand (X) column yesterday. Now the bearish resistance zone is 7800 to 8000, as indicated in the image.
With this reversal yester day Nifty spot opened up 3 probable out comes....as indicated image....

Probability 1: In this demand (X) column or in this move itself NS will break bearish resistance zone and generates a double top buy signal @ 8400 indicated in rectangle 1 and moves up.....My personal opinion is, it is less likely....

Probability 2: NS probably takes resistance around the Bearish resistance zone... and reverses back to retest 7000/7200 levels which is a bullish support trend line area indicated by rectangle 2....if it breaks this point and makes a low@6800 indicating decisive break of bullish support line likely hood of testing 6200 to 6400 zone indicated by rectangle 3 which is a bearish support zone....

Probabiltiy 3: If NS reverses to 7000/7200 zone[/B] and bears unable to crack bullish support line @6800 and NS reverses up again to Demand column(X) and breaks the high generating a double top buy above bearish resistance line....Then the formation is called bearish signal reversed....which is usually(but 7 columns or more or less can be there, the number is not sacrosanct) made up of 7 columns, 7th column being the demand column....then longer term perspective is changed to bullish again....
But un till probability 1 or 3 happens the Long term view of the chart is Bearish...so as of now the chart supports probability 2 more and probability 3 but probability 1 seems less likely...

But as most of us are short term traders(Swing and Day traders) we have to go with the short term flow,keeping in view and on alert when we approach Important levels on Longer term charts....
Mostly this rally is more based on easy monetary policy and low interest regime for periods longer than anticipated...Liquidity driven rallies can be ferocious(both ways, the rise and the fall) so we have to go with the flow and never argue with the market ....instead let us fall in line with the market ...the best way to make money...
Happy Learning and Happy trading....:thumb:

 

[praveen98]

Hi guys,
Hope every body is enjoying their weekend...Today i would like to post about Bullish signal Reversed, a special kind of trend reversal pattern ...where in market reverses without apparent signs of distribution...special for element of surprise...
For illustration purpose i am using BNF April futures 100X3 High-Low chart...
First image is the current position of the chart,which is real and rest of the images are created for the purpose of illustration and explaining formation of the Bullish signal Reversed...,but not actual Price Action in the market...

This is the current position of BNF April2016 as on 1st April.

Rest of the images posted below are created for illustration purpose to explain Bullish signal reversed...

Suppose if BNF corrects from this level to 15900 levels ..chart looks like this...

And from that level taking support it rallies back up to 16500 the chart looks like this...

From that level if it comes down again to breach the previous support @15900 and breaks 15800 low the chart looks like this...(Sell generated on 7th column)

This completes the formation and the formation is called Bullish signal reversed if this happens BNF is likely to retest run away gap formed on 1st March...then chart appears like this...

Now let me explain the formation...Usually this formation occurs at intermediate tops...And consists of 7 columns,7th supply column generates opposite signal(SELL) to the current trend...
Generally at the top/bottom of the rally a rectangular distribution/Accumulation pattern appears at the top /bottom but in the case of Bullish signal revesed no such distribution pattern appears before reversal...in the same way Bearish signal reversal is special reversal signal without apparent accumulation pattern....
When to look for these signals? When bulls can not push the price than one or two boxes above previous demand column and then reverses to supply column from there twice or thrice is the indication of trend exhaustion...
That is why these patterns comprise 7 columns usually,but it is not sacrosanct the same pattern if formed with less or more columns does not reduce its validity in respect of element of surprise...
The red trend line going above the top of columns is a subjective trend line and apart from that all other trend line are classic pnf trend lines...
By the way the Trend change point from down to up is @14700 which is cleared on 2nd March run away gap...you can see from the image 1 that bearish resistance line running diagonally from the top of 15600 in first column is broken @14700 which is also above Horizontal resistance line@14600...
By the way this is just for illustration purpose and figment of my imagination to present the Bullish signal Reversal...Most probably this may not happen in reality...
Have a nice weekend:thumb: