Sunday, July 15, 2012

Elliott wave & TA update for Nifty


Further to the last post , EW Probabilities in Long Term and an Update for Short Term trading is given below . Read the observations given in the charts carefully .


The Long term counts since Nov 2010 can be labelled as Double Three corrective combination of a Double Zigzag  (W ) , Expanded Flat (X) and now in Y . This suggests a bear market near an end which can break upwards .
Alternatively we can take the double zigzag as a wave A and now in B moving sideways to break down in a C.
The first probability is in line with Monthly chart counts in last post . Keep an eye on the Trendlines for a breakout later.



Below is a Daily chart since the end of DZZ showing both the probabilities.



Now for the Short term trading -

A three wave upmove in A-B-C since recent low of 4770 seems to be over. The price have broken the uptrendline and look ripe for further downside positionally as per the indicator and counts, if the high of 5349 holds in place.



The Hourly chart gives the C wave move since 5095 in  five subwaves that seems to be over at recent Top of 5349 . It was associated with negative diversion in Hourly MACD and Daily indicators too ,so has a potential to move further down if not invalidated by a cross of recent high .

The double bottom along with positive diversion may give a bounce next week if the level of 5215 holds. There is a Gap to be filled up as well as down which may be potential Resistance and Support zone.



The 5 min chart shows a five wave move down which also supports a retrace up if the last session low holds early next week.


Concluding , it looks like a Sell on Rise market positionally in the short term trading with a stoploss of 5350  . Breaking below the 20dma and last low we may move to 5150 and further down too. But on a cross of 5350 the levels of 5380-5420 ( near the long term Trendline ) are possible

Enjoy Your Trading !!!

30 comments:

Kumar Technicals said...

Dear RV!

As usual, its masterpiece by you. Keep guiding us always thru ur brilliant EW insight.

Rgrds,

Kumar

sam said...

always awaiting for your views on the mrkt . as usual amazing and indepth study

AAR VEE said...

@ Kumarji ,

U r a 'master' and this is only a 'piece' . EW is quite subjective to be cast in stone unlike ur objective study and trading.

Regards

@ sam ,

Thanks for the comment .

@ All ,

Those who are interested on a nicely compiled article on neo waves v/s traditional EW may please check KRG's blog -

http://krgonline.blogspot.in/

The link is also in lower section of the blog - 'The Comfortably Numb' to reach from here .

AAR VEE said...

@KRG ,

Couldnt post the following comment on ur blog even after few trials due to word verification -

Thanks for a nicely written comparitive. Please followup this article further in ur posts as and when u get time.

Also it will be nice if u share ur current counts as per neo on Long term charts since 2008 or 2010 and shed some light on whats in store moving ahead as per neo probabilities.

Regards
RV

KRG said...

Hi AarVee: Thanks for the thumbs-up. Well. I am not at all tech-savy; so cann't maintain the blog as well as I would like to. In fact I wanted to segregate my market vs other posts; dunno how to do..

On LT/MT view : No change at all since last year as you can see at my previous posts..

I feel that the major C should bottom out between Jun-Sep 2012 in price range of 3900-5000..This has been fitting with the sentiment being quite pessimistic thruout.

Last update I said 45xx probably completed the low and we might get a higher high at 48xx. The current upmove has to cross 5700 by this week to give a confirmation that C ended at 4770. Probably we are running out of time for this. Then the next ST probability is a second failure around 5000 for a fresh upmove.

Alternatively, we completed "C" at 4695 (January) and since then we are in the third phase of a corrective "D" or "X"

Cheers

karthikg said...

Looks like shailesh is right and nifty will only move up from 18-19 july but i have not been able to fathom his time line for the rally to start from that date.Perhaps others could throw some light on that.

AAR VEE said...

@KRG,

For segregating your market related posts from others ,u may try labelling them .The option of labelling comes at time of making a post and if u click on the label after the post u get all the posts under that label.U can even edit and add menu to ur posts even now. Another option is making seperate blog pages for ur market related and other for your else topics posts.this option comes in your main menu under 'pages' from where u make post/settings etc. if u go from 'design' button. The pages get displayed seperately on your main menu .

thanks for ur counts.

karthikg said...

Look at SnP and DOW.They are ready for a final burst higher which will be very volatile and may last a few weeks.Nifty irrespective of the falls in between is ready for 5900 in next 8-9 weeks.I would not miss it:-))

karthikg said...

KRG if you have noticed neely had reportedly been psychologically down since the last few years as most of his predictions on Neowave had gone awry and he himself seems to have admitted that and have lost faith in neowave and is concentrating on NRT (Neely river technology).Thats quite unfortunate if its true as neowave atleast from the TIME perspective was starting to look interesting.It was reported that neely lost quite a big chunk of amount based on neowaves in a single day that left him shattered.But he now seems to be concentrating on trading using NRT only.

KRG said...

Karthikg : (1) What is the source of your info? In my limited opinion, it is inaccurate. Going by his forecasting and trading service, he has been doing great on almost all the markets he tracks. One time I saw him going wrong consistently, in the last 4 yrs, was in later part of the 2009-10 upmove on S&P

(2)Incidentally, at that time, I have seen staunch Neely followers (following his own neo-wave methods) disagreeing with Neely and doing well. I guess the personal prejudices get the better of the method at some time! No body is immune including the inventor

(3) I mentioned in my write-up that neo-wave doesn't claim predictive power all the time. NRT is a proprietary methodlogy (it may be based more on technical indicators) which Neely uses when neowave predictive capacity in his opinion is low, and/or for shorter term trades.

(4) His money management system doesnot allow large losses in a single day (market can gap open hugely on the other side - which can happen to any trade or any system..right?)since he doesn't advocate more than 1-2% of capital risked in a trade.

karthikg said...

Well this is what a few of the people who attended his seminars and NRT training said.Wherein he himself had admitted to being right only 50% of the time using NEO wave and was thus concentrating on NRT as by the time one religiously follows NEOWAVES , half of the move is already over or one gets caught in the wrong stops.He himself had predicted a long gestation period where the volatility will be at the highest and unfortunately he seems to have been caught in his own web tangle.Using NRT which does not involve neowaves but uses a very modified proprietorial version of channeling he seems to be getting better results at trading and hence been concentrating on that since the last few years.There is no smoke without fire and putting hard stops is one thing and following them is another.Often brilliant minds like those do get caught in a tangle when what has worked for them so long suddenly appears to be faltering and failing shattering their confidence.This would likely explain his abandonment of his own methods of forecasting and relying more on using proprietary trading methods like NRT.

karthikg said...

At the same time i am sure his works are a beautiful piece of art which will not go waste as it embodies the best of gann analysis(time?) with elliott waves and a few other modifications which if used in conjunction would deliver better results.Atleast i am looking forward to learing the TIME element from his works and hopefully people like you,aarvee and shailesh could guide us on that front since you guys already have the experience on that.

KRG said...

There was this site, Planet Yelnick (now it is not so active), whose theme I love. It says that "all forecasters will eventually be hoist by their own petard". How true! You can add another theme "there is no Holy Grail"

As I said, in neo-wave, if you wait for post-pattern confirmations, you will wait for a long time for a trade set-up. So if you want more active market participation, you get on with something else.

However, using orthodox EW, if a trader could make money, it is becos of something else and not by rigorously following the EW counts; alternately it is just luck becos the objectivity of the counts is doubtful.

From the services run by Neely, it doesn't appear that he has given up his method, despite the above problem in any forecast. He is however on record that he doesn't follow Gann

Kumar Technicals said...

Dear RV!

Its always a pleasure to enjoy discussion of learned EW personalities at your blog. Your every post deserve big salute & thats why i am fan of your artistic work.

Rgrds

Kumar

AAR VEE said...

Hi Kumarji ,

Thanks for checking the updates here .

Regards

karthikg said...

Though nifty could come down again towards 5200 levels and below once more my target is around 5900 by mid september give or take a few weeks.

KRG said...

Karthikg: You mentioned people who have trained under Neely. Do they put out any medium term view?

karthikg said...

Well they are not indians and concentrate only on the US and Euro-Australian markets.

karthikg said...

Also i believe shailesh and you are one of the best sources on indian markets as far as Neowaves are concerned.

KRG said...

For some reason, neowave specialists seem to prefer to be in the background and donot discuss views too much. I am not a specialist as such and hence I put out whatever little I think I have understood!!

Cheers

karthikg said...

A fall to nifty spot 5137 from 5250 now will set the mood for the upmove from next week towards 5900

karthikg said...

Kudos to you KRG for coming out with your opinion and thoughts on Neowave and being transparent with it.Ditto with Aarvee who selflessly portrays his counts and thoughts artistically:-).

Piyush Sharda said...

@krg,

in neo i cant understand when ppl
make correctives of large price movement in same direction of previous trend. for example some neo wave ppl labes 1978-1991 move in sensex frm 100-4500 as impulse. the correction going on even the 4500-21000 move of 03-07 was a correction . i fail to understand this how can a impulse of 100-4500 correct form 4500-21000?

KRG said...

PS: I had covered this somewhat in my post on neo-wave.. Essentially anything not impulsive is corrective. A large X wave in the same direction of primary trend can be mistaken for a third wave in orthodoxy. The clincher is whether this "large" move was corrective or impulsive. The speed and price length both matter. Also for LT, may be one should look at logs or percentages...then it may not look all that big relatively speaking. Not too sure on the specific 2003-07; I would think it is impusive after the two-circuit day. I think that VP has both alternates open.

Just to look at the current situation, we could treat 4770-5124as impulsive, and the entire action since then could be a double three running correction with a large X wave between 51xx-53xx; with very bullish implications (going back below the 5000-51xx would be a negation though)

karthikg said...

Though we moved down from 5250 towards 5198 today on nifty there is one more alternate path that is possible if we dont break todays low on monday or tuesday and that is we open with a gap up or so on monday and then drift down towards 5210 again.What follows would be fireworks after that with nifty moving to 5500-600 in a jiffy without battling an eyelid as such.All in all we are very much on the right path for attaining 5900 in nifty by mid sept give or take a few weeks.

Piyush Sharda said...

well krg,
i read an article by neely that how ew ppl are full of opinions and by using neo techniques one can trade markets more mechanicallyand scientifically than ew .

but few things i done get.
1) the base of ew from which even neo is born that fin markets move in 5 in impused and 3 in correction in a degree then again 5-3. in ew there is a rule that after 12345 u label abc and while abc forms b can be higher than 5 upto max 1.38a. if greater the abc has ended in a and b is part of next impulse. quiet simple and mechanical. but here one is labelling 4500-21000 as part of x or b which is never allowed in ew.and why u r labelling as x maybe because some time calculation of neo or maybe channel has to break in impulse it didnt here or some other guideline. the basis of waves is 5 and 3 of same degree and then 5 and 3 does a move of 4500-21000 appear the part of correction of 100-3900. can a correction be at a much higher plane than impulse or it should be part of next impulse. is it logical and does it appeal to commonsense??
if correction goes multiple times of impulse then whole structure of 5-3 , which is basis of waves,wont it break
like u label 4700-5124 as impulse and the 5000-5348 as corrective. now correction in a different plane than the impulse then where is correction . we can treat is next wave of impulse. now how to label/provide for fall below
suppose

suppose 4770 u r assuming correction ends and fresh impulse there can be 3 scenarios
1)prices go to 5900+
2)prices go to 5400+ and fall
3) prices fall from here below 4770

1) 4770-5195 i set of 5 waves 5041 3.1, 3.2 on
2) 4770 onwards diagonal going on and invalidation 5400
3) 4770 was not the end of correction and 4770-5348 was abc

rest all channelelable or not, 5 waves visible or not etc are opinions and observations of years of analyst .

this is again my opinion only

Piyush Sharda said...

typo "invalidation 5041"

KRG said...

PS :
(1)I agree that subjectivity cannot be ruled out in EW.
(2)Neely allows B 1.618 of A
(3)Running corrections can be large but I doubt 4500-21k can be categorised as such. It may be corrective, if so it can be part of terminal impulse
(4) If correction is taking us higher, the implication for me is that the next impulse up will be explosive.

KRG said...

I think 4990 is an important invalidation point for upmove

Cheers

AAR VEE said...

Thanks KRG ,Piyush and Karthik on discussion on EW and enlightening with various possibilities .

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