Nifty has formed a bearish engulfing at the top but at a gap support. There is also a 5 month long trendline support around 9520-9540 levels. I will be more comfortable buying on dips considering its moving in an uptrend and I see a correction as an opportunity to add on my positions.
Bearish engulfing is effective when it is formed at the top and gets validated only when its low is broken. But here it might not be that effective as it is at a gap support , even if it breaches the gap it may face support at the trendline, therefore not offering a good risk reward.
Bearish engulfing is effective when it is formed at the top and gets validated only when its low is broken. But here it might not be that effective as it is at a gap support , even if it breaches the gap it may face support at the trendline, therefore not offering a good risk reward.
