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Ready for the New Season?


Market Analysis: Signs of a New Trend in Nifty 50

I've been closely monitoring the Indian markets and believe we're witnessing something significant. After weathering recent volatility, there are compelling signs that we may have established an important low in the Nifty 50. This isn't about the summer heat wave - it's about a potential market trend reversal that smart traders should be watching.

Evidence-Based Trading: What's Different This Time?

As a reactive trader who relies on evidence rather than speculation, I need substantial indicators before changing my stance. The current rally appears different from previous false starts, and here's why:

The ADX Story - "All-in-One Indicator"

Looking at the Nifty chart since September 2024, we've experienced two failed pullbacks and now a third rally. The key difference:

  • First pullback: 6% correction with ADX failing to show bullish dominance
  • Second pullback: Similar pattern, ADX again failed to establish bullish control
  • Current rally: Showing clear bullish dominance on the ADX indicator

Multiple Timeframe Confirmation

When we zoom out to higher timeframes, the evidence becomes more compelling:

  1. Weekly chart: Bullish harami pattern confirmation after previous failures
  2. Daily chart: Clear ADX divergence and a bullish crossover
  3. Monthly chart: Nifty testing and holding important moving average support

Strategic Approach Moving Forward

This confluence of technical signals provides enough evidence to adjust my trading strategy. I'm now looking to buy dips with appropriate stop losses. Remember - we're dealing with probabilities, not certainties.

The most common mistake traders make is confusing correction rallies with new trends. This analysis helps distinguish between the two and explains why I believe we're seeing a genuine trend reversal.

What are your thoughts? Are you seeing similar signals in your analysis?

#MarketTrends #NiftyAnalysis #TechnicalAnalysis #TradingStrategy #IndianMarkets #InvestmentInsights #ADXIndicator#AjitNayak

Prashant Dahale

Trading Business in Equity Derivatives and Commodities Market

4mo

Nifty trend has changed when it closed above 23100. The Trend is bullish now but not the right time to enter. We need to wait for sharp pullback, first minor dip towards 23110 then 22888 and the final pullback 22670. Any close below 22670 will again make new lows.

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