Nifty opened Gap up today and bounced sharply after opening without filling gap. Nifty bounced above yesterday’s high 8136 within first 15 minutes and traded with strength whole day. Wave (iv) which I explained in my yesterday’s Elliott Wave Analysis report of Nifty was highly Irregular so it completed well short my expected 23% retracement.
Let’s see what latest charts are saying.
This is 5 minutes time bar chart of Nifty showing move after Friday’s low 7940. It seems wave (1) completed from 7940-8034, wave (2) is completed from 8034-7952 as Irregular Correction and (3) is in progress.
Within wave (3), again it seems inner wave (iii) is completed at 8092 followed by the completion of wave (iv) as irregular correction at 8077. There is start of wave (v) of 3 which already achieved its normal projection of 61% at 8163 whereas 100% is placed at 8217. We can expect wave (v) as extended (more than 61%) as wave (iv) was huge Irregular Correction.
We can see some decline after completion of wave 3 (may be 23%-38% retracement of wave 3) as wave 4 followed the start of wave 5 upwards.
Completion of wave 3 seems near, may be in 8183-8217 range and we can expect a small 23-38% correction of wave 3 from top followed by a start of new impulse upside. Exact calculations can be done only after confirmation of completion of wave 3.
As I am suggesting from last 4-5 session, best strategy would be to use Buy on Dips with stop loss. Though we are expecting some correction for wave 4 but use this correction for Buy. Safe traders must use Buy on Dips and avoid selling for short term. Stop loss for longs must be some points below 38% retracement of wave 3 which can be calculated only after getting end of wave 3.
The lines are drawn on charts for further move is just indicative and not as per calculation as top for wave 3 is not confirmed yet.