Thursday, July 26, 2012

Nifty, Banknifty - Elliott Wave Analysis

Nifty 4 Hourly
Banknifty 4 Hourly
This is a 4 hour chart of Nifty, since the hourly and daily time frame, was getting confusing, I tried to hit the golden mean, and found some interesting things on the 4 hour chart of both Nifty and Banknifty. Nifty as I said in my last post had formed only 3 waves from the low of 4770, but on the 4 hour chart we can see a 5 wave pattern, though not totally convincing, but satisfactory to some extent. The Banknifty chart , also can be counted as a 5 wave move, with greater clarity than Nifty. In both these charts, and corresponding 5 wave moves, we can spot extensions in 5th waves. And hence the correction following the completion of the impulse move in wave I is going so deep. On Nifty we might test 5060-4990 range and for Banknifty we may test the 9900-9700 range. What is interesting is to take a look at the wave {A} of this corrective move on a larger fractal, given below. We can see that the first wave {A} of this 3 wave corrective move, was a straight advance, very sharp, on both the indices. So by the guideline of alternation, we can expect a more clearly subdivided move in wave {C}. And that is what is happening here, I feel.
Nifty Weekly
Banknifty Weekly


  1. All EW counts are fine.... but the rally from 2011 dec... is forcing all to look at it as impulse... i dont it is an major bear top..... now nifty will not go above 5350.... currectly the fall may drag the nifty till 4800 area... but will be a time consuming... but the counter trend will go to 5350 or rather 5200... ultimately looks like will bear EW count works 4500 should be taken and nifty should be moving lower......


    1. Dear Jeevan,
      First of all thanks for your comments. Its perfectly allowed in EWP to have multiple opinions, and it even provides specific invalidation points, so that if one count does not play out, you can always ump to the next best. But what my understanding of EWP warns me against is taking our analysis too seriously, what I mean by that is you should do serious hard work to arrive at a count, but it is all in the hands of markets (aka mass psychology) to respect your analysis or not. So the markets may move exactly as you have stated in your comment, but then again it may not. I feel the best way to tackle this problem is to have your invalidation points at hand, and follow the market wherever it takes you. Its less strenuous and profitable too.


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