Elliott Wave Analysis and Outlook of Nifty for 25 Jan 2017 Expiry Day

| January 24, 2017

Nifty opened mild gap up at 8407 and traded with strength for rest of the day. Nifty bounced more than 80 points to register day’s high 8480 before closing 84 points up at 8475. I expected minimum 182-295 points bounce from 8326-8244 odd range in my earlier report and Nifty already bounced more than 150 points from 8327.

In Yesterday’s report, I had mentioned the possibility of bounce towards 8543-8678 (216-351 points from 8327) in coming days and revised stoploss for longs was 8381, and further advised to change the stoploss to 8403 once Nifty breaks above 8427. Nifty bounced till 8480 without triggering stop losses. Let’s have a fresh look at latest charts for further scenario.

Today I am covering bounce from 26 Dec 2016 low 7893 and earlier wave counts are explained in my previous analysis report Elliott Wave Outlook of Nifty for 11 Jan 2017 Onward.

Elliott wave counts of nifty on HACoulry chart

Elliott wave counts of nifty on HACoulry chart

This is hourly time bar chart of Nifty covering bounce from 26 Dec 2016 low 7893. The whole bounce from low started slowly with overlapping of waves but gained speed as progressed higher. Same as I explained in last report,

By looking at the structure at bottom and personality of the bounce, it seems wave (3) is completed at 8417, wave (4) may be completed at 8327 as “Irregular Complex correction” and wave (5) may be in progress from 8327. Earlier I marked 8461 as end of wave (3) but pattern of the decline after 8461 (pattern of wave 4) is not supporting the same which I explained on next chart.

There were repeated upside  impulses followed by downward correctives (overlapping of waves) at bottom which could be Wave (1) and (2), followed inner wave (i) and (ii) of (3), followed by inner wave 1 and 2 of (iii) as marked at the bottom on chart. And further Nifty may have completed all waves 3, (iii) and (3) till 8461 with speed and gaps (personality of wave 3).

As we changed the end of wave (3) from 8461 to 8417, calculation of wave (5) needs to be done with respect to 8417. So, minimum 38%-61% projection for wave (5) will changed to 8526-8650 (earlier it was 8543-8678).

Important Note for Learners:

If we look at the whole bounce from 7893 carefully then there are repeated Irregular Corrections and Complex patterns within this whole bounce, even this sharp bounce started with overlapping. If you have noticed my analysis reports of last 01 month then I was bullish most of the time because we had not seen any sign of reversal in whole bounce.

But we found it difficult to calculate exact entry levels and stoploss many times and this is because of these complex patterns and Irregular Corrections. It is very difficult to calculate exact levels in advance when a complex pattern is forming. That’s why I force everyone to learn because exact levels in such complex condition can be calculated during market hours only.

So, let’s have a separate look at progress of wave (4) and (5) on next 15 minutes chart for short term levels and scenario.

Elliott wave counts of nifty on 15 Minutes chart

Elliott wave counts of nifty on 15 Minutes chart

This is 15 minutes time bar chart of Nifty covering decline from 8461 which I am expecting as progress of wave (4) marked on 1st 30 minutes chart.

There is very complex type of pattern formed at top. It seems the completion of (abc) wave from 8460-8327 but there is one more high (8461) before start of this (abc) from 8460. So, wave (4) may be completed as Irregular Complex Correction.

May be an Irregular (abc) cycle completed from 8417-8373, Wave (X) completed from 8373-8460 which is also complex and 2nd (abc) cycle completed from 8460-8327 as shown on chart. Overall it seems Double Zigzag with irregular first (abc) cycle.

After completion of wave (4) at 8327, inner wave (i) of (5) may be completed from 8327-8403, wave (ii) may be completed from 8403-8351 which retraced about 61% and wave (iii) of (5) may be in progress from 8351.

38% retracement of wave (iii) of (5) is placed at 8430 which is the point below which we can think of any reversal and same must be the stoploss of longs.

Conclusion:

For Medium Term, Nifty already bounced more than 150 points as expected from 8326-8244 range and further Nifty have possibility to bounce towards 8526-8650. Minimum 8526 we can expect if I am right at identifying the pattern.

For Short Term, Stoploss for longs must be 8429 and expected upside range in 8526-8650. Nifty may trade within 8430-8527 range tomorrow.

For Trading Point of View:

For Medium/Short Term, revised stoploss for existing/fresh longs must be 8429 now and 8526-8650 is expected target range on upside. 8526 is the point above which some/part profit needs to be booked.

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Category: Nifty

About the Author ()

Deepak Kumar is an independent Technical Analyst, regular practitioner and Trainer of Elliott wave theory applying Elliott's Wave Principles on Indian Markets successfully since 2011 and made many accurate predictions. He is also the author of book "Practical Application of Elliott's Wave Principles by Deepak Kumar"

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