Elliott Wave Analysis Report of Nifty for 22 March 2016

| March 21, 2016

Nifty opened gap up at 7619 and traded strength for rest of the day with volatility. First Nifty broke above 7659 followed by a correction till 7628 but bounced again above 7700 to register day’s high 7713 before closing 99 points up at 7704.

Yesterday I mentioned that 7622-7659 is a crucial range and explained different trading strategies based on that. Suggested to book profit or trail stoploss after 7622, longs can be hold if Nifty open or break above 7659 with stoploss of 7609 for targets 7701-7757. And sell (buy puts) only if Nifty achieve 7622 but fails to break above 7659 same day. Selling conditions didn’t match as Nifty broke above 7659 and also bounced above 7701 without breaking below 7609. Let’s have fresh look at latest charts now.

Today I am showing Nifty move from 29 Feb 2016 low 6825. Earlier counts you can read in my previous analysis report Elliott Wave Outlook of Nifty for Budget Day 29 Feb 2016 Onward.

Elliott Wave Theory counts of Nifty on 15 minutes chart

Elliott Wave Theory counts of Nifty on 15 minutes chart

This is 15 minute time bar chart of Nifty covering move from 29 Feb 2016 low 6825.

As I explained yesterday, it seems wave (1) completed from 6825-7094 and wave (2) completed from 7094-6969 then wave (3) started from 6969. Wave (3) started slow but extended sharply later with just 23% correction in between.

The bounce from 6969 is straight with just a 23% correction in between and with unfilled gaps and most probable counts I have shown on charts. May be it is inner wave (v) of (3) is in progress from 7405.

If inner wave (iv) of (3) is completed at 7405 then wave (v) already achieved minimum 38% projection after breaking 7622 whereas 61%-70% projection is placed at 7757-8804 which may or may not be achieved.

Let’s have a look at the move after 16 March 2016 low 7504 which I have shown as start of inner wave (v) of 3.

Elliott Wave Theory counts of Nifty on 5 minutes chart

Elliott Wave Theory counts of Nifty on 5 minutes chart

 

This is 5 minutes time bar chart of Nifty covering move after 16 March 2016 low 7405 which I have shown as start of inner wave (v) of 3.

Yesterday I expected that it may be wave (3) completed at 7585 followed by wave (4) completed at 7479 which retraced about 61% but wave (5) in this case projected more than 123% which is not normal. So, may be the other possibility is in progress.

It may be wave (1) completed from 7405-7585, wave (2) completed from 7585-7479 which retraced 61% followed by wave (3) started from 7479 which achieved 123% projection till now.

And within wave (3), it may be inner wave (v) is in progress which already achieved its minimum 38% projection whereas 61% projection is placed at 7741.

38% retracement for whole wave (3) started from 7479-7713 is placed at 7623 which must be the stoploss for any existing longs.

Conclusion:

Nifty finally achieved long awaited 7622 today but also break above 7659 within an hour after achieving 7622. Now, inner wave (v) started from 7405 is still within inner wave (3) so next 61% projection of wave (v) is also possible which is placed at 7757 whereas 70% is placed at 7804.

Stoploss for any existing/fresh longs must be 7623 which is 38% retracement of whole wave (3) shown on 5 minutes chart.

Nifty may give a good selling opportunity in coming days for 240-400 points but keep patience and wait for right levels and low risk opportunity.

Any trade can be initiated or managed based on above mentioned conditions using strict stoploss.

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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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