In the attached chart i am showing 3 pattens. To avoid confusion i have used different colors for each patten. The pattens are :
1) Head and Shoulders
2) Expanding Triangle
3) Inverted head and Shoulders
1. Head and Shoulders : Its a big one. now we are forming right shoulder in that (If we are unable to move up from here go back then we can see this as right shoulder). Neckline support is at 2660 now. This line of support is very big one if this is taken out then the next target for nifty is 2050. But there are other supports in between, still the ultimate destination is 2050. I have marked this entire patten with green color. Just observe the volumes we have large volumes while coming down from head and comparatively low volumes while moving up in the right shoulder (For clear view on this look at the weekly charts).
2. Expanding Triangle : This patten forms when large number of immature people participate, Lack of proper trend. We generally see the huge volumes when this patten is forming (Which is clearly visible). All these leads to instability in the system (System may crash due to this). This one didn't reach the top line last time showing that it is acting like a continuation patten, if at this point of time that top line is at 2990. if it doesn't reach there and fall from here the then the support line will not stop the fall. Calculating the target for this waste coz the support and resistance lines are very steep.(every day they keep on changing with big value).
3. Inverted Head and Shoulders : Its a small one, marked with blue color. Neckline support is at 2895 now. Yesterday we have retested the neckline. Target is 3100. If 2727 is taken out then this inverted H&S becomes invalid at that point we may see the huge shorting which lead us to 2660. Volumes are according to the patten formation for better view look at the daily charts.
http://img24.imageshack.us/img24/3503/niftyze9.png
http://img124.imageshack.us/img124/5991/niftyhsyx1.png
http://img124.imageshack.us/img124/7059/expandingtriangleua3.png
http://img140.imageshack.us/img140/6940/hswvolsz5.png
