Nifty weakened and signaled a bearish breakdown

On April 23rd, the Nifty 50 confirmed the minor reversal observed on April 22nd with a significant gap down opening of 175 points. In the early hours, there was an attempt to surpass 24,300 on the upside, but the momentum couldn't be maintained. Gradually, Nifty drifted downward and lingered around 24,200 for an extended period before eventually losing the 24,200 support level, closing the day at 24,173.

The closing validated two aspects: a definitive break from the EBR/EBL band and a strong red candle on the MHAF chart. This indicated a new bearish movement, and as per the spreadsheet below, we could have initiated a short position at the closing price.

This bearish trend is likely to end if Nifty reverses and rises above 24385 (a dynamic level that will depend on Friday's price action). A new bullish signal might emerge around the 24500 level. However, no short position was taken because we are in the final week of the April series, and we are waiting for a new trend to start in the May series after April 28th.

Happy trading.