Nifty: Point and Figure Analysis

Trend is up. 6110 important level!!

Date: 28^th October 2013

I have been saying that following price is a much better business and worth enjoying. Column reversal triggered exit from longs below 6170 during last week. So position is neutral at the moment and trend is up. 

Charts analysis:

Figure 1: Trend is up and upper counts are dominating. Triple top breakout has made the setup bullish. So I am looking for longs. But close below 6120 will form High Pole bearish formation and longs cannot be taken then unless new high box is made. Hence Fresh longs are only possible if Nifty closes above 6210. Anchor Point supports are around 5850.

Figure 2: As can be seen in the chart, low below 6110 will form Bull trap bearish pattern and it will trigger opportunity to go short. Prices might come to 5900 in that case. Fresh longs to be taken if high is made above 6260.

  

P&F strategy for next week:

Hence setup will become quiet bearish below 6110. And subsequent double bottom sell signal must be taken. Aggressive traders can short at 6110 also with stoploss placed at 50 points (5 boxes).

Fresh long should be taken if price closes above 6210 or high is made above 6260.

 Figure 1: Nifty 10 x 3 CL Point and Figure Chart

 Figure 2: Nifty 10 x 3 HL Point and Figure Chart

 -  Prashant Shah, CMT, CFTe

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