Nifty continues its consolidation/ correction after reaching its new high and presently have found support at 6650. The following daily chart shows the weakening hourly trend (the twin lines) which continued to fall even while the indices was making a new high at 6850 levels. This was a clear indication that a short term top was in place. The indices also broke the lower end of the channel at 6720 which gives it a technical target of 6550 which coincides with top of wave 3. In the event of 6650 broken we may see further fall of 100 points to 6550. The hourly trend has fallen into bearish territory and is yet to show any signs of strength/ divergence.
In the following weekly chart of Nifty once can see the hourly trend (black dotted line) in negative zone. However, the weekly (dark green line) and the monthly (light green line) trends continue to show strong intermediate and long term strength with a bullish alignment pattern. The reversal of hourly trend above zero is likely to result in a massive spurt in indices to reach higher targets of 7500-7600, which is also the technical level due to be achieved for the inverse H&S formation as indicated in our earlier post Nifty Inverse H&S of April 22, 2014.
As can be seen above the Nifty weekly chart displays the hourly trend , apart from the daily, weekly and monthly trends which represent the minor, intermediate and the major trends respectively. This has been made possible by our pathbreaking Triple Trend Oscillator.
