S&P 500 5 minutes chart with a diamond pattern which is slightly out of shape. But still the pattern touches the trend lines on all sides.
Price has entered the pattern from the top trend line. So a break of the support line can be expected for this one. But one has to be cautious because of the time frame, it has come in the 5 minutes chart so reliability is less.
First chart shows a negative candle at the top of the range and after that there was not a single day which closed above 5 day high EMA. Most of the action shifted to 5 day low ema giving chance to sell on rise.
Next chart shows price closing below 20 DMA. Shortly if this down move is not stopped price will have an encounter with 50 DMA.
The best trades are done when two or more set ups come together. Look towards the left side corner of the chart A HAMMER ON THE 50 DMA which is an easy long to take with a small stop loss.
We had a similar set up in nifty futures intraday chart. A Trend line and the 50 hour moving average came together to pull the index down.
All the contents of niftychartsandpatterns are for educational purposes only and are not Investment Advice or recommendations offered to any person(s) with respect to the purchase or sale of the stocks / futures. Niftychartsandpatterns shall not be held responsible for the actions of individuals, parties, or corporations taken in response to the ideas, thoughts, concepts or information presented in this blog. Hence all the visitors are requested to apply their prudence and consult their financial or investment adviser before acting on any of the Ideas in this blog.
"All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical formations and patterns recur on a constant basis." —Jesse Livermore