Pattern Recognition Analysis in Markets

Pattern recognition analysis is one of the most useful and effective method in helping traders in finding and gauging the risk reward of the trades. It is an advanced form of Screen reading which can be backed up by data as well.

Some of them might be applicable for day trading, some maybe for swing trading.

Please read the below mentioned examples to see it how works :

Examples of patterns include :

  1. Divergence between sectors (Like if Bank nifty is up on a particular day, nifty IT is down or flat usually)

  2. If INR appreciates on any given day, Nifty Bank is most likely to be positive.

Let us all use this thread to observe and note the patterns that traders find during the specific timeframe (Intraday, Swing trades)

It would be helpful to the rest of the community if we do it on a uniform manner like :

Date :
Pattern :
Timeframe (applicability of the pattern) : this can be edited afterwards
Additional remarks : (like how well or bad it worked )

8 Likes

Nifty IT as a sector has just crossed Bank Nifty in terms of Index price. I believe this is the first time it has happened since the creation of both the indices.

It would be interesting to see what happens from here on. Will CNX IT lead the sectoral pack from hereon or will Bank Nifty stage a roaring comeback?

3 Likes

Bank Nifty has given negative returns and Nifty IT has risen by more than 10% in last 17 days (from this observation)

Nifty IT has single-handedly emerged as the leader in this leg of market recovery. All this has happened even when there was sufficient appreciation in rupee vs dollar which is generally seen as a negative indicator for IT pack.

These patterns help us with not only short term views but sometimes also gives us the long term direction.

The main question with this current pattern is : Will Bank nifty make a roaring comeback or will IT continue to lead going forward…

Disclaimer : These posts about finding various patterns are purely for educational purpose. (with practical scenario analysis)

1 Like

Bank Nifty is once back to the numero uno position. This is super interesting. @Meher_Smaran

Nifty Closing

15.02.2022 - 17352
16.02.2022 - 17322
17.02.2022 - 17305
18.02.2022 - 17276
21.02.2022 - 17206
22.02.2022 - 17092
23.02.2022 - 17063

  • Market is making Lower Close from the previous Close every day from last 7 days.

  • This pattern needs to change if the market has to turn bullish going forward.