Wednesday, December 18, 2013

Application of Trendlines and Channels on Nifty!

The below research is published by Waves Strategy Advisors. For more details visit
Trendlines and Channels are the most basic aspect or studies of technical analysis.
These are the first thing a technical analyst learns but slowly this simple technique takes a back seat as the complexity of study increases. I believe that each of the technique has its own value and trendlines are the integral part of the study which cannot be left behind even if one learns advanced concepts like Elliott wave, Fibonacci projections or Cycle theory.
The below weekly chart of Nifty clearly shows one of the most important channels that has been working for many years now.
We published this chart in today’s morning equity report “The Financial Waves short term update” that combines this technique along with Elliott wave for high probable path market can take. A brief outline of the study and combination is given below:
Nifty Weekly chart:
Importance of Trendlines and Channels:
We have been looking at long term trendlines and channels to understand the crucial support and resistance levels. The weekly chart shown above is giving a very clear picture. Prices are taking very strong resistance near the center trendline which is valid since 2009 onwards. It is for consecutive 6 times the center trendline acted as resistance and prior it acted as support on almost 5 occasions. As per Elliott wave perspective, one push on upside is pending and we are pretty sure the same trendline will again act as very strong resistance which is now near ………. levels. Any strong move above ……….. is required to change the price band towards upper half. This chart reflects the magic of trendlines and channels which has been working precisely since 2008 – 2009 onwards.
In short, 6110 – 6140 is the support zone and ………….
When Elliott wave counts are applied along with the above technique it forms a very powerful forecasting tool!
To know how we are applying various different technical analysis techniques together not only on major indices but also on individual stocks you have to simply subscribe to “The Financial Waves short term update” by visiting Pricing page and you will get the research report on daily basis in your mailbox. In case of any queries for understanding the report you can always contact our research analysts.

No comments:

Post a Comment