Market Trend Lab

EVENING STAR CANDLESTICK PATTERN The  evening star  candlestick is the bearish version of the morning star. It is a top reversal pattern.    The evening star also a three candle pattern with the first candle being a strongly bullish candle showing buying acceleration. The second candle is the star which shows indecision while the third is long red real body shows sellers taking the control. This third candle closes well into the body of first candle.

(Daily Chart) IMPORTANT POINTS FOR TRADING Banknifty is Very much trading in downward channel and traingle pattern. As indicated earlier about the hammer candle stick  pattern near the support line of channel and triangle, Banknifty has taken a U-turn and rallied for nearly 500 points . Now on 22nd,23rd and 24th May it had made morning star candlestick pattern which is also a one kind of bottom reversal pattern as long as the lowest low of the pattern (in this case 9157 ) is not violated else the pattern is negated. However be prepared for some sort of pullback which happens nearly 50% of time. Today upside resistance are 9500-9540 zone and downside supports are 9290 and below that 9157 level MORNING STAR CANDLESTICK PATTERN

(Daily Chart) IMPORTANT POINTS FOR TRADING:

Everyday Banknifty is making new low and lower high. Yesterday banknifty had tested 200 Week EMA @ 9080 but manage to close above it and it should be protected this week end also otherwise there will be more bearishness. Still it is trading within triangle and  downward channel and made a hammer candlestick pattern. Today banknifty has support around 9050-9100 zone and resistance around 9285-9350 zone. (Daily Chart) HAMMER CANDLESTICK PATTERN

Today Banknifty closed @ 10173.55 with the loss of 3.33%. All banking stocks were closed in red. Today top loser are Union bank and IDBI with loss of 5.48% & 5.01% respectively. Day range of Banknifty was 10583.75 to 10135.85 . Till 1.30 pm Banknifty was hovring near 10500 by 50+/- points but found difficult to sustain above 10500 being a monthly resistance hence given up all the gain. Even yesterday mentioned that weakness will be only below 10345 level and thereafter it was a free fall till todays' Agni level 10138. Today Banknifty has made bearish Engulfing candle in Daily chart : (click to enlarge image) Below 10117  Banknifty may fall upto 10060-9900

Yesterday Banknifty opened gap up @10286.80 i.e. above Agni level and JBNSAR for the day. During the day posted weekly chart and suggested that strength will be above 10440 only and it showed it power and made high of 10526.55. In weekly chart Banknifty has made Long Lower shedow candle twice which is interpreted as a bullish signal  but it also requires follow up confirmation.    (weekly  chart) candlesticks with long lower shadows  A candlestick (black or white) where its lower shadow is two-thirds  or more of the total candle’s range.  It indicate that sellers dominated during the session and drove prices  lower. However, buyers later resurfaced to bid prices higher by the  end of the session and the strong close created a long lower shadow.  That is rejection of  lower prices and is therefore seen as a bullish signal.    

(click on image to enlarge) In weekly chart Banknifty has made Long Lower shedow candle (last week) which is interpreted as a bullish signal  but it also requires follow up confirmation.   The Developing candle in weekly chart is still in red . Strength will be above 10440 only.