Support line of the wedge is broken. Index is moving away from 50 DMA. But Falling wedges are considered to be bullish pattern, Since this pattern has given a break down in favour of bears, Bulls would hoping for a busted pattern.
CHART - 1
S&P 500 is trading in a falling wedge pattern.
Today a rally is going on towards the upper trend line of the pattern were it may find resistance. The resistance levels is about 1087-1089.
Dow Jones futures is trading in a falling wedge pattern.
The support line of the wedge was tested and violated on friday when the index traded at 10140 levels But the index made a smart recovery to close well within the pattern.
Since the trend is down the chances of another attempt to break the support may happen again. other thing to note is that the price is approaching the apex of the pattern so one may wait till a clear direction emerges before taking a position.
Reliance industries is trading below an important trend line shown in the first chart. Stock should break this trend line and trade above it for bullish moves to happen.
Second chart shows how the stock has broken a short term trend line. But it is still trading below 20 SMA.
Trading above 20 SMA means Trading above the trend line shown in the first chart which should be positive.
If the stock moves above 20 SMA and makes a daily close above it I am expecting the stock to touch 1040 levels. I
f the stock gets resisted at 20 SMA and the broken trend line of the first chart It will be bearish in the short term.
