Sunday, June 23, 2013

Elliott Wave & Technical Analysis for Nifty

As in the last post , without invalidating 5885 , tested 5640 and below but held this support on closing basis. Lets check further -

1. Weekly TF :

The Lower Trend Line of Wedge has Supported as of now and is an important support  on closing basis . Below that further bearishness may come and target the Channel Trend line .

2. Daily TF :

After whipsawing 200 dma , Prices have kept below it . Sustained Up move only above it as of now. Watch for break of Down Trendline for bullish signal .

3. Elliott Wave Probability :

Though it's likely an A-B-C move down from 6229 or a corrective W-X-Y-XX-Z but can be a 5 wave move also .
Below 5778 we are likely to go down again to test the recent bottom and further below.

4. Option & NF data :

The Open Interest built up in Options is at 5800 CE & 5600 PE strikes. This may be the probable broad range for the expiry week of June series. Close below 5600 will be further bearish and 5800 may resist on closing basis.

NF data suggests Short buildup after 10th June below 5870 . The series may expire below it . The series dynamics is tilted in favour of the Bears .

Larger Trend is Down . It may remain below 5800 this week . Close below 5640 will be bearish and can target 5570 and below. Expiry pressure may further extend the downside below 5570 . Close above 5750 will be bullish in short term with close above 200 dma signalling a reversal .


shriram said...

Hi RV,

Nice post.

w3 : 6133-5683 has not done > 1.618xw1

If so, w5 will need to be Extended & go much lower < 5400 NS, is it not ?

Either that or,
can we view
6133-5618 as a sub-dividing w3 in play /done on Friday ?

chetas said...

Dear Aarvee,

Thanks for the detailed post,

Some queries :

going with the count that we are in iv-c ( minor wave), i want to know the invalidation.

1) the clear invalidation being 5778 wave i., wanted to know can we also arrive at invalidation of ivth wave like this looking at 5 mts chart

a-iv started at 5617 to 5686, 69 pts,

b-iv , 5686-5624 62pts ( more than 80% and also NF made new low at this point ), or we can say b-iv ended at 5628.85

c-iv from 5624/5628 can do
if c= a 5693/5697 or if c=1.618, max can do 111, ie 5735/5739.

So can we say the invalidation as 5740.

watching cricket :) so sending you a late commend ,

as always impressed by your crystal clear analysis , thank you so much

AAR VEE said...

@Shriram ,

wave 3 has done apprx 1.54 times wave 1 . Doing 1.62 or more is not the rule . The rule only suggests wave 3 to be longest.

Yes we still can be in wave 3's subwave trading .

Following price is the only answer to these subjectivity.

@Chetas ,

So what happens if the probable wave iv instead of a-b-c goes for a corrective combination and extends? or c ends truncated / ends below 5700 ?

The invalidation can only be one price and that is 5778.Rest is up to the trader's method how he finds his low risk zone to enter.It may be in parts at likely resistances .

shriram said...


any 1 motive-frac in Motive impulses does > 1.618 into the smallest of 3 motive-fracs , is the guideline, which we refer, isnt it ?

looking @ the Slow MACD (regular 12,26,9) suggests sub-dividing 3rd,m but as u said, nothing sure till we see a consolidation near 5400-5550 odd zone in NS

AAR VEE said...

@Shriram ,

No wonder EW is subjective . Whatever you trade have the invalidations and targets for it .

AAR VEE said...

UPDATE : 24-06-13

The basic target of 5570 reached early in the week itself.

Now if the low of today's session holds on hrly closing basis in the first half tmrw, we may see a technical intraday bounce.

Resistance now in the zone of 5665-5685.

Trend remains down and break of 5570 convincingly may take it further down to 5500 levels and below .Close above 5685 will neutralize the downtrend in short term now .

shriram said...

yes, that is true.

Slow MACD is showing Histo. Div on day T/A

if 5561 NS holds, a bounce is due, else we sink lower to 5501-5434 NS for next catchment areas

shriram said...

how r u seeing todays move RV,

a ZZ done 5567-5665 or seeing it as "a" UP to be followed by "b" & "c"

pl do update ur thoughts on lables EOD, so can guage how the labling is being re-calibrated with live price action


AAR VEE said...

@shriram ,

There can be many valid EW observations at any given point of time . I don't change my macro observation daily ,until compelled by price move .

Hope u read hard learned inputs shared for EW trading in last post comments carefully regarding futility of small tf subwave tracking ,prediction tendencies etc .
The update remains the same as of last session eod given above in comment section.

shriram said...

yes Aar Vee,

Read thru the 10pts & hv similar feeling. Smaller t/f labling is a waste of mental energy no doubt.

just asked to hear how to follow-thru on a set up end of everyday.

On the MT we are down, what are the catchment areas now per you as on ysday EOD?


shriram said...

To clarify , my queries , as am more of an intra player..

so feel the need to re-calibrate / assess, the framework everyday, to maintain the edge.

Pls reply only when a lable emerges to u as obvious, no hurries


AAR VEE said...

@shriram ,

1." just asked to hear how to follow-thru on a set up end of everyday."

U book at supports and sell at resistances intraday position size and carry rest/all if the signal continues price wise eod. Though i avoid the intraday trades ,idea is to hold positional till reversal.

2."what are the catchment areas now per you as on ysday EOD?"

The resistance & support zone remains same even today eod that of 5665-85 and near 5570 apprx. Prediction of a corrective subwave pattern has its own perils , u try selling near/in resistance zone and book in supports of higher tf till pattern is clear.

3. " my queries , as am more of an intra player..

so feel the need to re-calibrate / assess, the framework everyday, to maintain the edge. "

Intraday is not my cup of tea ,burnt many times, so I may not be of much help there .

4. "Pls reply only when a lable emerges to u as obvious, no hurries"

As of now I have no signals for reversal ,even if it gaps up tomorrow. The observations ,zone of resistance ,support, reversal , extension of trend remains same as eod 24-06.

EW alone is not a potent tool for trading specially intraday . I use many others as u may see in blog posts ,that of moving avergaes ,indicators ,trendlines ,fibonacci, volumes etc and trade with help of multiple tf's and assessment of prevailing trend.


shriram said...

Tks for the Reply RV,

infact i avoid EW lables like the plague, see too many lables @ one time & finally end up doing nothing!

so was lookin for "an out-sourced" EW opinion from u :-)

I trade based on a DSP system that i developed after reading JOH EHLERS.

My shaolin is to sell 3-5% OTM strike next mnth CE/PEs near Wk TA RES / SUPPORT (candle / fibbo / TL / Hi-LoEMA , OScill OS/OB, options buildup all incl.)

it allows hi prob entry, wid fixed SL & fixed traded lots.

EW, prefer to read thru the lables posted by all u guys & try to fine tune..

thank u. U were the first guy in 2011 to share the books wid me, I am indebted . Nice long journey u v put me onto :-)


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