Nifty 50 - Where is it going? Elliott Waves Analysis

31 thg 5, 2020

Hey, whassup reader?

I bring you an analysis of Nifty 50 using Eliott waves and found the price to be respecting the waves theory from 1996 till today.
Here's my approach, observations, and some prediction mentioned below for you. Like and comment on what do you think about it.
You can zoom out in the chart to see the wave pattern formation across time.

Approach -
1. Decide a timeframe for validating if the index is respecting Eliott waves theory - Used weekly Timeframe for this
2. Decide a time frame to predict where the price move will happen in the near future based on the behavior of recent corrective wave caused by corona - Used daily time frame for this

Observations -
1. The index respects Eliott wave very well as demonstrated by the Fibonacci levels of the motive and corrective wave. (I cannot put multiple Fibonacci on one chart on top of another so that's one exercise which you can do yourself)
2. The coronavirus marked the end of the second motive wave which pushed nifty prices up from the bottom of the housing bubble in 2008.
3. The correction wave by corona (wave A) was impulsive in nature making prices fall to a bottom of 7.6K
4. Wave A saw retracement by Wave B (50% Fibonacci level of Wave A - is at 9854) taking prices high to the current level which is 9580.

The story gets interesting now.
Is wave B going to get over at 9800 level and Nifty 50 will fall from there again??
How far up the prices can go by wave B of NIFTY 50 before it will get weak again and will be taken over by wave C?
Wave C can make the price fall again till what level? Can nifty go below 7500?

Predictions -
Note: This is completely based on my analysis and understanding of Elliott waves. I will not advise you to trade according to my analysis results.
a. Wave B is not over yet. The price will increase to a minimum of 9854.1 (50% Fibonacci retracement of Wave A by wave B) or a maximum of 10407 (38% fibonacci retracement of wave A by wave B).
b. Given the impulsive correction of wave 5 by the corona induced wave A, a zig zag or complex recovery is expected.
c. Another fall will follow the high of wave B, which will bring the prices below the previous low of 7.5K
d. The fall can be as low as 6041 (1.6 Fibonacci level) of Wave A caused by corona.

My trade setup -
Right now, I will go long till 9854 level/10407 level. If 9854 level is crossed and stock moves high towards 10407 level then I will put a stop loss at 9854 level. At 10407, I will exit the trade and wait for other SR levels to decide my next position.

Thanks for reading it till here. Hope you liked the analysis.

Do let me know what do you think about Nifty 50 prices in the coming months in the comments below.

1 like = 1000 Encouragements. Please like and follow me for more such ideas
Ankit

9 thg 6, 2020

Ghi chú

I feel that the correction phase has begun and I can very well be wrong. Please only take a general directional view from my analysis and use it only for educational purposes. My estimated level was 10407 and if you can take a (+-)0.5% deviation from the estimated level which the correction starting from 10328 levels is possible. The market is bearish now according to my analysis.

Also the price faced strong resistance from 50 periods EMA on the monthly timeframe. If the price manages to break the resistance of 50 period EMA then the analysis will fail and I will advice you to not rely on it anymore.

23 thg 6, 2020

Đóng lệnh: dừng lỗ

Chart not holding to its trend. Please don't follow the analysis any more. I need to update my analysis based on the new movements observed in the market.