Nifty opened gap down at 7838 and registered low 7813 within second after opening but bounced sharply by 50 points from low. Nifty consolidated in 7840-7870 range till 2:00 PM followed by a decline of 45 points again. Finally Nifty closed 17 points down at 7831 after registering low of 7813 and high of 7870.
I my last report, I mentioned Nifty can decline 60-100 points from 7862 or from day’s high without breaking much above 7875-7882. Nifty decline just 50 points from high but without breaking above 7875-7882. Let’s have a fresh look at latest charts.
Today I am showing Elliott wave counts only after 16 Nov low 7714 as previous counts are same as I explained in my yesterday’s report Nifty EW Analysis for 19 Nov 2015 – Perfect Example of 3-3-5 Flat Correction.
This is 15 minutes time bar chart of Nifty covering move after 16 Nov’s low 7714.
It seems an impulse is completed from 7714-7860 followed by corrective ‘abc’ decline from 7860-7725. This upside impulse may be wave (A or 1) and downwards corrective decline may be wave (B or 2).
After completion of wave (B or 2) at 7725, wave (C or 3) has achieved exactly 123% projection after touching 7905 which is normal projection we expect for wave (C). So there are 02 possibilities,
- Maybe it is wave (C) already completed at 7906 and downward wave for 7714 and below started as move after high 7906 became slow which is not normal for wave 3.
- But if I look at inner wave structure of wave (C or 3) alone, the move doesn’t convincingly look like a complete impulse yet. So, may be wave (C or 3) still in progress.
As there are 02 possibilities on above chart so we need to concentrate on decline from 7906 for further scenario.
This is 5 minute time bar chart of Nifty covering decline from 19 Nov’s high 7906.
In this chart, it seems an impulse is completed from 7906-7844 but I am not able to identify the pattern of decline after that as shown on chart. There is overlapping of waves at lower levels but pattern is not Ending Diagonal Triangle. May be it is some sort of wave 5 and the whole decline from 7906-7812 is impulse, overall I am not convinced with any pattern here.
But, if I look at the bounce from 7813-7870 then it seems completion an impulse. This impulse can be wave (1) or (A) of (C of Irregular Correction). I am showing so many possibilities because wave pattern which Nifty made before this bounce is not clear.
Now, if I look at last decline from 7870-7823 then it looks like a 3 wave’s move which can be either (abc) or (123). But, if it is waves 123 then also the possibility for any big down move is rare as wave 1, 2 and 3 is comparatively small.
61%-100% projection of the whole decline from 7906-7813 is placed at 7812-7777 whereas 123% is placed at 7755. On the upside, 100%-61% projection of the impulse (7813-7870) is placed at 7880-7915.
Nifty charts are not suggesting any big downside from these levels in next 1-2 days and a short term bounce can come. Though, very short term pattern is not clear so it is difficult to calculate exact lower range.
For tomorrow, Nifty can be bought if open gap up above 7843 using stoploss of 7822 expecting upside targets of 7880-7915.
If Nifty opens Gap down but trades above opening price at 9:31 AM then also nifty can be bought with day’s low (low till 9:31 AM) as stoploss expecting bounce of 57-90 points.
I am not able to identify any condition favoring Sell on latest short term charts.
Any trade can be initiated only during market hours tomorrow based on above mentioned conditions with strict stoploss after seeing latest wave’s pattern. Be limited to intraday trades only as conditions are not favorable for any positional trade yet.