The evening star is a set of 3 consecutive candles as can
be seen at the 4693.20 top around the 2nd week of June 09
on the weekly chart of the nifty above. It is a strong signal
when accompanied by -
1. RSI coming down from overbought levels
2. A strong inflexion point - note the 4500 level acting
as resistance and support at various points in the past
3. A possible double top - note 4649.85 in August 2008.
As usual, what are the entry and exit points?
There is always a strong possibility that the instrument
will make one more move up for a double-top in the RSI.
We will look at the daily chart for the trading triggers
in the next post.
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