Tuesday, January 22, 2013

Nifty - Elliott Wave Update

  1. I have labeled the tentative EW count on the chart above. I feel we are close to wave [3] top. That is the most likely count at this stage.
  2. But there is a likelihood of a final dash to 6168-6188 band, where there is another confluence zone which might end the wave [3].
  3. RSI is showing a negative divergence, also we have a rising trend line which has offered good support to this up move. The only place where we have a breach of this TL is when we were forming wave (4) of [3] (that is typical of 4th waves). We may get another break of this rising TL during wave [4]. 
  4. This wave [4] may target the area of previous wave (4), that's just basic EW guidelines.
  1. This chart shows ROC indicator, which is also showing persistent negative divergence. This rising trend was supported by a rising TL, which can also be seen as a neckline for a HnS on ROC.
  2. The channel drawn is a slightly different, the lower channel boundary, should be breached to signal and end of wave [4], given that wave [3] is done, else the channel will have to be redrawn.

2 comments:

  1. Sir
    why does ur 1 start from 4770
    ideally it should be 5032
    in all likelyhood u r presuming this to be a corrective rally?

    ReplyDelete
    Replies
    1. Well,
      5630-4770 was a 3 wave move.
      What pattern are you counting till 5032 I would like to know?
      If this is not the start of a new multi-year bull market, we should at least see one more leg up to complete the 5 wave advance from 4770, which might be wave C of a corrective rally from 4530 levels.
      But I would take it one leg at a time, and right now looking for a correction in wave [4].
      Regards
      Aniruddha

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