Sunday, March 27, 2011

Elliott Wave Analysis for Nifty Trading

"You cannot change the direction of the winds but you can adjust your sails as per it."

Successful Trading depends on how well one manages the uncertainities. It requires one to have the balance between having conviction to follow his belief and flexibility to recognize when to change the perspective .

Let us check out the EW counts at this juncture.

1. Please go through the basic EW insight that I have been following - Click Here
We are currently in the larger 'c' wave down of the 4th wave on the long term charts.

2. This 'c' wave will unfold in three waves down. Currently we may be in 'A 'or the 'B' wave. This 'A' may be unfolding in five wave structure(marked in black) or is completed in three waves and we are in the 'B' wave up (marked in red). The former is my preferred count as of now.(based on Weekly Indicators and Patterns)

3. The complex correction that we are seeing in the 4th wave of the 'A' or the probable 'B' wave may be marked as follows. 

As per the EW experts, Elliott Wave International -
There is an alternation within a complex correction . The correction may begin with a flat a-b-c construction of the A wave followed by a zigzag in the B wave. An illustration may help understand this .

This is a reference image of a complex correction within a larger bullish count .(opposite to what we are witnessing ,a bearish one ) 

4. In the Immediate term, we are in the 'C' wave of this complex correction ,the structure of which may be as shown below. The III rd wave of this is in progress which may /may not go up from the last close.The probable IV th wave of this 'C' may end near 5550 levels that is near the 4th wave of the lesser degree.

5. Alternate Count :

If the wave 4th of the 'A' will cross 5752 on closing basis ( the end of wave 1 ) ,alternate count will come into play (marked in red in the first chart ) .The Fibonacci targets of this wave will come to apprx. 5900 and 6100 level.

This has been discussed as the 'Dark Horse' count in couple of my previous Posts & Comments - Click Here

6. So a likely Positional play based on above observations may be -

Closing price of 5752 is the most important level. One may enter initial shorts (on completion of wave V of the ongoing 'C') with strict s/l  if fails to close above 5752 and then position size to play for the 5th wave of the wave 'A' .

Alternatively if closes above 5752 one may go long for the Fibo targets discussed above for the Wave 'B'.


Bramesh said...

Hi Sir,

Sorry for delay in reply.My site has been facing lots of technical issues which am trying to overcome.

As soon as i get it up i will let you know to update your Blogroll.

All plugin data i have lost :(



bizagra said...

Aarvee sir, how come some charts showing end of wave1 as 5690 and yr showing 5752???thanks

bizagra said...

I hav checked,end of wave1 is 5690. 5752 is end of 1st wave of 3rd.plz clear.

AAR VEE said...

Hi Bramesh,

I am sorry about ur loss ,I know how hard it is seeing the work u are doing .Please take help of Mr. Rajandran of Marketcalls ,I remember his site under virus attack about a year back and loss of data due to it. I think he has a post on his blog on how to recover it.

AAR VEE said...

Hi Bizagra,

U r right about 5690 for the wave 1. I too have mentioned it in my previous posts. But to be sure positionally i try and follow the daily line chart based on close price basis .The closing price that day is 5752.

Hence i have mentioned it under alternate count as well as positional play " closing price of 5752-----"

Hope i am clear on it.

Piyush Sharda said...

hi rv ,

nice presentation and analysis and good application of complex corrective.

2 things i wanted to point. what i have read that ew is not concerned with closing only high and low. so ideally 5690 shud be invalidation.

in the sub waves of 3rd of 3rd, 3rd is coming as shortest pls check.

bizagra said...

Thanks Aarvee, got it.

AAR VEE said...

Hi PS,

1. I keep closing prices for confirmation of waves Primary or Intermediate nature. I think its logical too. the subminuette and minutes can be watched closely with high ,lows.
I have not read that closing price/line chart of it cannot be considered for wave count.
Please give me the reference link of the same.

2. corrected,thanks for keeping close eye on the third eye.


Piyush Sharda said...

rv the 3rd wave i was referring to was
5398-5473 1
5460-5528 3
5496-5588 5

i have read it in elliott wave explained by robert beckman . i have a hard copy. he stated it clearly that ew not concerned with
close prices. maybe if u try u can find the soft copy on net but i got it frm vision books.

AAR VEE said...

Take it as-
i = 5401.95-5473.20
iii= 5456.35-5528.25
v= 5496.10-5588.70

I will try to find the answer to the charts.