Is NSE 50 Nifty ready for nose dive?

billauday · #1 3rd May 2005, 08:48 AM

nifty daily chart has formed head & shoulders pattern and the current price is lingering at neck line of 1900 support,if it breaks that line then the first target would be 1620 levels ,so guys be careful

Traderji · #2 3rd May 2005, 09:32 AM

Good observation! Would appreciate if you could explain this visually (with charts) for the benefit of the other members in this forum.

Thanks.

kumarkant · #3 3rd May 2005, 09:32 AM

Hello Friends... I am Kumar. Joined the group a few days back.. Trade and invest as hobby. My professional field is different..
As far as behaviour of Nifty is concerned, the underlying fact that lots of people and Institutions are presently sitting on a lot of cash needs to be kept in mind.. all waiting for the prices to fall so that they can step in.. Therefore the chances of Nifty receiving support at 1900 are a wee bit low given the current market sentiment... 1620 may be the next support level technically, but my assessment is that the buyers will start trooping in once the Nifty drops another 5% ie around 1800 levels.. I am assessing this purely from the investor psychology point of view.....
Suggestions are welcome

billauday · #4 3rd May 2005, 09:53 AM

traderji i always have problems in posting the chart ,can anyone tell me how to post a chart in to the forum.i would be glad for that.

Traderji · #5 3rd May 2005, 09:57 AM

Quote:

Originally Posted by billauday

traderji i always have problems in posting the chart ,can anyone tell me how to post a chart in to the forum.i would be glad for that.

To post a chart:

Save the chart as a gif or png image in your pc.

Go to the message in the forum and hit the "Post Reply" button. Then scroll down and hit the "Manage Attachments" button.

A pop up box will open. Click on 'Browse". Select the path on your PC where you have saved the image. Click "Upload".

Once the file is uploaded click on the 'Close this window" button.

Then click the "Submit reply" button.

Traderji · #6 3rd May 2005, 12:24 PM

Before jumping to any conclusions there are two possibilites one should consider:

Current Scenerio: The Nifty is in a downward sloping channel (see attached chart). The Nifty has taken support at the 1900 levels at least 4-5 times in the past 30 days and also 4-5 times in January 2005. Thus the 1900 level is a very important SUPPORT level for the Nifty.

First Possibility
The Nifty breaks the 1900 level.
This would confirm a downtrend. The likely technical target for the Nifty then would be 1620-1650 levels. This level can be calculated by taking the difference between the 09th March 2005 peak (2183.45) and the 1900 level (equal to 283.45) and substracting it from the 1900 level. This gives us a level of 1616.55.

Second Possibility
The Nifty bounces back UP from the 1900 level.
This would confirm a sideways trading range for the Nifty and the likely target would be a 38% or 50 % retracement level which works out to be 2006 and 2039 levels.

So which way would the Nifty head? Pull out your charts and post them here with your comments.

andy · #7 3rd May 2005, 12:36 PM

I see a BULLISH RSI Divergence in the NSE Nifty 50 and therefore see the NSE 50 Nifty taking support at 1900!

You can see chart at http://finance.*****.com/q/ta?s=%5EN...=c&p=&a=r14&c=

Mohan · #8 3rd May 2005, 01:47 PM

Quote:

Originally Posted by Traderji

Before jumping to any conclusions there are two possibilites one should consider:

Current Scenerio: The Nifty is in a downward sloping channel (see attached chart). The Nifty has taken support at the 1900 levels at least 4-5 times in the past 30 days and also 4-5 times in January 2005. Thus the 1900 level is a very important SUPPORT level for the Nifty.

First Possibility
The Nifty breaks the 1900 level.
This would confirm a downtrend. The likely technical target for the Nifty then would be 1620-1650 levels. This level can be calculated by taking the difference between the 09th March 2005 peak (2183.45) and the 1900 level (equal to 283.45) and substracting it from the 1900 level. This gives us a level of 1616.55.

Second Possibility
The Nifty bounces back UP from the 1900 level.
This would confirm a sideways trading range for the Nifty and the like target would be a 38% or 50 % retracement level. This works out to be 2006 and 2039 levels.

So which way would the Nifty head? Pull out your charts and post them here with your comments.

Informative writeup traderji!

The indicators on the weekly chart indicates that the NSE Nifty will go below 1900!

Traderji · #9 3rd May 2005, 03:35 PM

As of today's close the Nifty has held on the 1900 support!

Nksagar · #10 3rd May 2005, 03:49 PM

Dear Traderji,

Well explained and appreciate .
The shares market generally bottom out til month of mid june and as the rains starts from south India and is perfected its timing and six mnthly results of the cos gets to its lustre level and demands settle down and july sees maintainign the same level as of this month as it has to make u curve .I feel the market always have this cyclical order with the index attaining tthe heights and lowest according to interest of global investors and investor confidence .ur explanation is absolutely wait and watch.,is wonderful.
Best regards,
ur Nksagar

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