Nifty Futures 30min Charts
How to Interpret the markets when it is totally moving in a sideways direction?
Sideways markets occurs if there is no real interest neither from the buyers nor sellers. Lower trading interest results in lower transaction volume. If the sideways action attracts huge volume possibly it could be due to institutional accumulation/distribution.
Most of the sideways movement are often dominated by Short term traders anticipating a breakout whenever it is reaching one side of the consolidation zone.
But when the markets are completely dominated by short term traders (buyers and sellers) what one can face is a broader consolidation zones.
Sideways markets are nothing but repeated breakout failures. More the markets are likely to take a sideways direction more the participants are likely to get frustrated and more likely to give up their trading views about the market.
In Nifty futures Some time back people are talking about triangle patterns and now the triangle almost now becomes
But the real question is when the market is more likely to get rid of consolidation? What could possibly trigger such kind of breakout?
Recent uptrend in Nifty February contract from 10600 level is followed by ultra low volume which is the result of the frustration. Thats the subtle change one can be able to spot which explains that we are very near to the break from the consolidation zone.