Nifty Opened Gap up of 29 points, and started moving down with good volumes forming the right shoulder for the head and shoulders from 26th June to today. But the break down volumes were not as good as desired, but also not too far from ideal. Target for this pattern reached with out any good retracement. Below is the 5 min chart of Nifty Futures:
In the other angle as expected CD leg formed an extension to the AB leg, which I have posted on 27th June. Today it reached the first target of 61.8%, but Nifty dipped down a little bit below the support line and moved up with good volumes. Below is the 20 min chart of Nifty Futures:
Cues For Tomorrow (July 1st):
Nifty can show weakness below 4220/4200 levels. Else there could be chances of moving up. As today’s move is 64% of all entire up move from 23rd June again harmonics may come into play, to from the CD leg. Pull back with good volumes was also seen at the end of the day. Good reversal signals must be seen in order to trade CD leg as the BC leg was with good volumes. Also the gap which has formed on 26th June is not covered yet, which could be one more support for the price.
On the higher side 4345/50 levels may give resistance, above which it can reach up to 4450 levels. One can expect some recovery for tomorrow.
On the lower side gap at 4250 may give support, and then 4220 may act as good support. Below which Nifty may show bearishness. Below is the 20 min chart of Nifty Futures:
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