...pattern implication for a Double Top is calculated on the basis of height of the pattern, which is the distance from the 2 Tops to the low made between these 2 tops.
In the present case, both the tops were near 30184 and the low between these tops was at 29804. The difference of 380 Sensex pts can, therefore, be projected downwards from 29804, as a pattern implication of the Double Top. This would project about 29425 for Sensex (9173 for Nifty).
Remember, again, that the downward pattern implication discussed above, is a possibility to be considered only when the low of 29804 (Nifty 9269) is decisively broken on the downside, with higher volumes.
This contention would also mean that holding last week’s bottom or the gap-up area created on 25th April could deny the -ve implications of the suspected Double Top.
....If the suspected Double Top confirms, then such a pattern could turn out to be a major top, provided Sensex also unfolds the following 2 events : (1) “faster retracement” below starting point of “g” at 29241 (Nifty 9075) (2) “lower top lower bottom” formation.
The action for the fresh week, as seen from the perspective of the discussion above, would appear crucial not only for our structural choice, but also for the medium term direction of the market.
Read more at http://content.icicidirect.com/ULFiles/UploadFile_201758101417.asp
In the present case, both the tops were near 30184 and the low between these tops was at 29804. The difference of 380 Sensex pts can, therefore, be projected downwards from 29804, as a pattern implication of the Double Top. This would project about 29425 for Sensex (9173 for Nifty).
Remember, again, that the downward pattern implication discussed above, is a possibility to be considered only when the low of 29804 (Nifty 9269) is decisively broken on the downside, with higher volumes.
This contention would also mean that holding last week’s bottom or the gap-up area created on 25th April could deny the -ve implications of the suspected Double Top.
....If the suspected Double Top confirms, then such a pattern could turn out to be a major top, provided Sensex also unfolds the following 2 events : (1) “faster retracement” below starting point of “g” at 29241 (Nifty 9075) (2) “lower top lower bottom” formation.
The action for the fresh week, as seen from the perspective of the discussion above, would appear crucial not only for our structural choice, but also for the medium term direction of the market.
Read more at http://content.icicidirect.com/ULFiles/UploadFile_201758101417.asp
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