I thought I’d do something a little different in my weekly take of India’s “Nifty” Stock Index ($CNXN) and describe a Fibonacci Confluence Resistance Zone and also run a Fibonacci Price Projection Point as well.

“Nifty” Confluence Fibonacci Grid:

Without giving away too many of my secrets, or the method behind the madness, we see key Confluence Fibonacci overhead resistance at the 3,580 level which also corresponds currently with the falling 50 week EMA. Should price break-out above the current range and 20 week EMA (both of which could be extremely difficult), we would expect significant supply coming in at that level.

I was going to write another daily update, but the analysis is the same as last week, as price still remains in a consolidation.

Now let’s really do something interesting and try to make a Fibonacci Price Projection low using advanced Fibonacci methods.

“Nifty” Fibonacci Price Projection:

Fibonacci grids are drawn off the 6,300 truncated high down to key support levels in the past.  A confluence zone was identified and then the vertical distance was measured from the peak down to this confluence level, and then I came forward and projected this same vertical distance (the size of the rectangle is irrelevant) down (subtracted) from the confluence zone (at 4,100) to get a final price projection target of 1,970.

I’m not necessarily saying we’ll go down to that target, but if price begins to fall from here, the 1,970 level would be an excellent area to watch for advanced Fibonacci support.

In summary, we have Confluence Fibonacci Resistance at 3,580, and a Fibonacci Price Projection possible Low at 1,970.  It’s up to the market to determine which area it will test next, but – unless the trend and structure (via moving averages and swing lows and highs) changes, odds as I seem them are slightly more favorable that we break-down to test the 2,000 level.

As always, your comments and thoughts (and links to other sites) are welcome.

Corey Rosenbloom
Afraid to Trade.com

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