Nifty opened more than 100 points lower at 11605 and traded with negative bias for rest of the day. Finally, Nifty closed 114 points down at 11598 after registering low 11571 and low 11632.
Yesterday, there was possibility for a bounce towards 11796 and 11656 was pattern negation point on downside. We needed to look at the pattern again of Nifty breaks below 11656.
Trading strategy was to buy Nifty on Dips with stoploss below 11656 expecting bounce towards 11796 but Nifty opened more than 100 points lower and pattern negation point was broken at opening only. Now, let’s have a fresh look at latest charts for any other pattern and further scenario.
This analysis report is covering move after 6825 and earlier wave counts are explained in my last “All Time Frames” analysis report Fresh Elliott Wave Analysis of Nifty on All Time Frame dated 03 Jun 2018.
This is daily time bar chart of Nifty covering bounce after low 6825 which I marked as start of wave [V] on daily chart in my last “All Time Frames” Report. This is the same chart with explanation which I had explained in my last analysis report because there is no change in wave counts on this chart.
The last bounce from 9951-11760 looks like a 3 waves move and Nifty declined very sharply from 11760 without completing Impulse or ED Pattern. So, wave counts and personality of move is indicating the possibility of Irregular Correction at top.
So, may be inner wave ‘3’ of [v] is completed at 11171 and ‘4’ may be completed at Irregular Correction at 10004 and wave ‘5’ may be in progress. Minimum 38%-61% projection for wave 5 is placed at 11664-12689 but earlier high is 11760, so 11760-12689 is minimum target range for completion of wave 5. Wave 5 achieved minimum 11761 but pattern doesn’t seem completed.
So, let’s analyse the progress of wave 5 started from 10004 separately to calculate internal moves.
This is again daily time bar chart of Nifty covering bounce after 10004 which I marked as start of inner wave ‘5’ of [v] on daily chart. Again, there is no change in wave counts on this chart.
It seems an Impulse completed from 10004-10985 and same can be marked as wave (A or 1), there is Double Irregular Correction from 10985-10585 and same can be marked as wave (B or 2) and wave (C or 3) may be completed at 11856 or still in progress
23%-38% retracement of progress of wave (C or 3) is placed at 11556-11370. So, 11556-11370 is fresh short/medium term support and 11370 is short/medium term downside breakeven point and any bigger reversal can be expected after break below 11370 only.
Now, let’s analyse the decline started from 11856 to check its pattern.
This is 15 minutes time bar chart of Nifty covering decline after 11856 which I marked as end of wave (C or 3) on daily chart.
There is lots of confusion on this chart because of sharp move and repeated overlapping in between. I had to change the wave counts every next day on this chart. Pattern is again confusing but still I tried to mark most probable wave counts.
May be a complex correction is in progress from 11856 with first (abc) cycle completed from 11586-11588, wave (X) may be completed from 11588-11796 as Irregular Correction and 2nd (abc) cycle may be in progress from 11796.
From 11796, wave (a or 1) may be completed from 11796-11625, wave (b or 2) may be completed from 11625-11789 and wave (c or 3) may be in progress.
Within wave (c or 3), it seems inner wave (i) completed from 11789-11714, (ii) may be completed from 11714-11770 and wave (iii) may be in progress.
23%-38% retracement of progress of wave (c or 3) is placed at 11629-11656. So, 11629-11656 is immediate resistance and 11656 is immediate upside breakeven point. Nifty if breaks and stay above 11656 for 15 minutes can result in further bounce towards 11714-11770, otherwise one more decline of minimum 70-110 points is possible [as inner wave (v) of (c or 3)]
For Short/Medium Term: – Nifty is in positive zone for medium term with 11556-11370 as fresh short/medium term support. Any bigger reversal can be expected after break below 11370 only. 11856-11999 expected target range.
For Intraday/Very Short Term, 11629-11656 is immediate resistance and 11656 is immediate upside breakeven point. Nifty if breaks and stay above 11656 for 15 minutes can result in further bounce towards 11714-11770.
Otherwise one more decline of minimum 70-110 points is possible from 11629-11656 if Nifty fails to break above 11656
We need to keep all these conditions in mind while deciding next trade.
Trading Points of View:
According to conditions on charts: –
Nifty if breaks and stay above 11656 for 15 minutes can result in further bounce towards 11714-11770 but entry levels and stoploss for buying can be calculated during market hours only.
Nifty if forms upside corrective pattern in 11629-11656 range then selling can be done for 70-110 points decline but this trade needs confirmation during market hours to check upside corrective pattern.
Pattern is complex and market is going to be volatile because of Elections Result in coming weeks. So, it is not possible to decide a trade a day in advance.
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