THE NEXT TARGET IS 3605. BET!
Not very many technical analysts will stake their reputation and stick their neck out on such audacious claim but the sign to me is unmistakable. Nifty is heading towards a slow but ultimately rewarding recovery to 3605 level.
Time span? That's the tricky question. But apparently, it is not going to happen in a hurry. The upmove from the bottom of 2595 has not been too bad. It has moved up around 600 points in 17 trading days - roughly 3.5 weeks. But it has not been spectacular also considering that 3 of those 17 days provided 200+ points to the upmove.
The basis of my fairly sanguine view is a very very visible - and large - head & shoulder pattern formed at the bottom. HS patterns are almost 100% infallible and is regarded as trend reversal pattern. HS forming at an upward rally spells doom for the uptrend and would signal the beginning of a downward correction leading possibly to a trend change. But an inverted HS forming an upside down pyramid at a downtrend signals a recovery and often in a change of trend.
I am keenly watching the scenario unfold. You can often come back to this page to find the lastest posting on Nifty's position.
With a series of strong plaforms below Friday's closing price of 3175, Nifty may move sluggishly sideways for a longish period before finally jumping up. On the downside, there are too many supports which should absorb selling pressures, unless some major negative happens.
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