Wednesday, February 16, 2011


Today was a low volume ,rangebound ,Sideways Trading Market .

1. There is a negative diversion in Hourly and  5-day Charts.

2. Markets were unable to scale the 2day high and 20 dema at apprx. 5505 levels.

3. As seen in Hrly charts ,Indicators are oversold ,So are they now in Daily charts .

4. Remember 5560 levels is an imp. fibo level to come above the 2day high .It also is the Feb. Month's High level. So the significance increases.

5. In this narrow range Market ,FII's sold again , 230 cr.

6. Divergence trade should be done with strict s/l. ,as there are chances of range expansion near by ,so don't be caught on the wrong foot. Below today's low , can test the 5420 levels again. Above 5520 we may get 5560 level.

 Broad observations remain the same as yesterday, though specifics change.
Read yesterday's Post carefully again - Next Is What


Sujatha said...

Hi aarvee,

Very nicely and simply maintaining!!!?? :) so nice keep it simple policy :)) finally i could't resist myself the posted below is just i done as a "prekg" shared with mynac. Can you just tell me this count is wrong or right? this is not the way to count???

EW : the 4th jan high of 6181 till fridays low of 5177). nifty after making the diwali high of 6338 if it is in “abc” zigzag correction (means) with down ”a” having been completed at 5690, up “b” completed at 6181 & now down “c” is on the process??? this down “c” perhaps has completed 3 sub waves and on friday nifty perhaps completed the 3rd down sub wave at 5177 and the rise since fridays lows of 5177 is perhaps the part of 4th up wave (that should under normal circumstances touch the upper channel ) around 5440/50 and fall or more higher 5550 then fall to 5th sub wave around 5k levels.

Another option - if we take 123 reversal pattern from the high of 6338 to the low of 5690 followed by the high of 6181 then we can expect low of 5042 but let me see this time how it’s panning out for me. Not panning out.. huh, I will not try again for “fun also”

REGARDING NECKLINE - if 6338/6181 (as per nearly 1 ½ year weekly chart) doube head means, 5690 is coming as “neckline” (pls. cross check if u want) then it has give target of 5042

AAR VEE said...

Dear Sujatha,
Nice of u to come dowm here.EW 'itching' kya??

Regarding the EW count ,What i understand from ur comment is ,u are counting 6338 as the staring of 'a' and 6182 as starting of 'b' in the zigzag 'a-b-c' correction.

1.This count may be correct in long term scenario and i will be doing an EW post on it at weekend.

2.I was taking this correction as 5 wave down after completion of 5 impluse wave up from 4786/4675 levels( whatever u count from).But since the negation of 5418 levels the 3rd wave ,or what u call a 'c' seems to be complete.the target of this was 5150-5200 levels.(check the "short term analysis" post for detailed analysis).if 'a' or '1' as i mark is 650 pts approx,'c' is either 100% of 'a' or extend by 161.8% i.e. 1050pts approx,hence the target of 5200-5150 for the '3'rd or 'c'.

3. Presently i am taking it as the '4th' wave which will get invalidated above 5690 ,the region of wave '1'.(check post-"Ew analysis" on this weekend.)

4. The completion of 3rd/c and trading above 5418 levels bring forth an alternative count,that this correction was in three waves down ,a-b-c as u count.together they make a larger 'A' .we may be in the 'B' wave up ,which may negate 5690 and travel to more than 78.6% of this 'A' i.e. to 80% of 6338 levels, near 6000 levels, in three waves up ,then will come the larger 'C' which may be equal or extended in ratio of this 'A'(6338-5177).

4. Pl.take the larger/long term view in count while counting the short term scenario.check-"longterm analysis "post. We are in 4th wave since 2008 .It may be a triangle of ABCDE.
A was in 2008.B in 2009-10.This is C.Which itself will divide in three waves A-B-C,out of which A may be over at 6338-5177 and we may be in B.(Triangles are in 3-3-3-3-3 structure)

5.This view will be posted in weekend post.Though my preferred count still is the 4th wave.but i sense that it can be negated now.if not than this C will unfold in 5waves down,with target much below 5000 levels.

6.U are taking this as 4th wave of the 'c'(of the a-b-c) but i am taking it as the 4th wave of the bigger 'C'(5 waves down) ,since my 4th wave count got invalidated at 5418 levels.

7.The point of negation remains 5690 levels for this 4th wave.

8.Pl. I sincerly urge u to check the "long term" post EW ,then the "medium term" post EW,then the "short term post" EW and finally the "EW analysis" post on last weekend to understand my Ew insight.

9.If its 4th of C then its going to take time till mid march ,below 5690 to fall in the 5th.
If its the B wave of the larger count ,It may goto 6000 levels then fall and then go up again (three waves),i.e a range bound market for at least three months.

10.U r right about the 1-2-3 pattern .if 1 was 650 pts then below 5700 ,it should go to 5050 levels,but then these patterns have no certainity they should be combined with other TA's like imp supports ,trendlines etc.

11.U can send me the H$S chart ,i can analyze further.I can get from ur comment,but remember the neckline at 5690 remains of importance in any analysis.

12. What we must do in trade is that be clear that the trending mkt. is ver positionally now. We are in a rangebound market.only swings of 100 or so points be traded ,profit booking should be fast.All these theories are to help us not make us dependent,ultimately price rules and we have to adjust or perish.

AAR VEE said...

Dear Sujatha,

On second thoughts regarding the 1-2-3 pattern,
the target for 3 should be 500 pts below 5690 i.e. 5190
It has also been achieved :( .

Pl. check the pattern and claculation ,if i am correct.

U made my day by giving the food for 'Itching':))

Unknown said...

Thank you Sir for your analysis

Unknown said...

one request...please give the link of the medium term and long term on right hand corner of the blog so that it is always there to read...
thank you

AAR VEE said...

Hi prabha,

Thanks for the comment,
The Links are at the footer below in the Popular Post subhead.Do visit them to get an insight.

Sujatha said...

good morning AARVEE

OOps. sorry i hv taken your valuable time. Thanks a ton for your explanation and guidance. i saved it. Will do my "EW itching" @ my free time. Believe simplest thing is better to "copy your method" :) how u r doing :D.

Have a good day.


AAR VEE said...

Good Morning Sujatha,

Its I who should thank u.First for visiting here and second for making me think.(I may be doing a very basic mistake in my shortterm EW count as mentioned in answer to u.)I will update an EW post on weekend and will try to rectify it.

Pl. check the 1-2-3 pattern answer and let me know if my undersatnding is correct.