Here’s the Point by Point Price Action Analysis on Nifty 50 for the week of 30 Oct 2023, to make sense of the Price action outlook and Big picture. Take a look at the chart analysis to understand the reference and gather ideas.
Nifty 50 Point by Point Price Action Analysis on 1D chart
Major Key points in Price Action Analysis
1. Starting point of the Uptrend
The Nifty 50 index embarked on an impressive uptrend. Prices were climbing steadily, and investors enjoyed the ride. The uptrend started on the month of April 2023
2. Four Back to Back Pullbacks
However, as the uptrend continued, the market experienced four back-to-back pullbacks. These back to back pullbacks are often a sign of weakness and hinted at a potential shift in market sentiment.
3. Market Structure Changed
Once the Market structure changed, Price behaviour shifted, and the once-robust uptrend began to show signs of exhaustion. It was a pivotal moment that trapped uninformed traders and investors alike.
4. Transition into Range bound Market
Nifty 50 then entered a phase of consolidation, transforming into a range-bound market. This shift led to an increased level of uncertainty, leaving traders in a dilemma about the future direction of the index.
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5. Parallel Resistance at 20400
The prices approached the resistance level at 20,400. The resistance acted as a formidable barrier that the index struggled to overcome.
6. Parallel Support at 19400
On the flip side, a reliable support level at 19,400 provided some solace to traders. It acted as a safety net, preventing the Nifty 50 from plummeting further, at least temporarily.
7. Dip Buyers are trapped
Many dip buyers attempted to capitalize on the support level, but their optimism was short-lived. The market took an unexpected turn, trapping those who had bought in anticipation of a rebound.
8. Breakout and Strong Selling Pressure
A noticeable breakout with strong selling pressure emerged at the Support. This increase in selling pressure began to raise concerns among market participants.
9. What’s next from here?
Just FYI, I am an individual trader, not a SEBI registered advisor, this article is for educational purpose only. I am sharing only my view. So do your own analysis and always take calculated risks.
Further continuation of this selling pressure might start a new downtrend in Nifty 50. Psychologically if market participants become more fearful, this fear could potentially mark the beginning of a new downtrend.
As a Trader, I will be looking forward to take a Bearish Bias and initiate short trades. I won’t be convinced by short term upside rallies.
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In order for me to change the bias from Bearish to bullish, I would like to see a strong upside swing and momentum in the price.
