Elliott Wave Outlook of Nifty for 16 Oct 2017 Onward

| October 15, 2017

Nifty opened higher at 10123 and traded with huge strength for rest of the day. Nifty bounced more than 90 points to register life time high 10191 and finally closed 71 points up at 10167. Let’s have a fresh look at latest charts for further scenario.

Friday, short term and medium term outlook was bullish for bounce above 10178 in coming days. Trading strategy was “Buying on Dip” until Nifty achieves 10178 with 10066 as immediate breakeven point on downside. Nifty achieved new life time high above 10178 on Friday which we calculated 2 weeks before near 9700. Now, let’s have a fresh look at latest charts for further scenario.

Today I am covering decline from 19 Sep 2017 high 10178 and earlier wave counts are explained in my previous analysis report Nifty can Bounce Above 10178 in Coming Days – Elliott Wave Analysis 

Elliott Wave Analysis of Nifty on 30 minute chart

Elliott Wave Analysis of Nifty on 30 minute chart

This is 30 minutes time bar chart of Nifty covering decline from all time high 10178 which I am expecting as start of wave (C) of Irregular Correction (explained in previous report).

It seems wave (C) of irregular correction is already completed at 9687 and new Impulse for new high above 10178 has been started. Earlier high 10178 already breached on Friday.

And within the bounce from 9687, the wave started gradually but picked up speed after 9955 and there is also an Irregular Correction from 10015-9955 before picking speed. So after seeing the structure and personality of move, the most probable wave counts are: –

May be wave (1) completed from 9786-9945, (2) completed from 9945-9881 and wave (3) may be in progress from 9881. 38% retracement of progress of whole wave (3) is placed at 10072, so 10072 is the breakeven point below which we can think of any medium term reversal.

Further within wave (3), it seems inner wave (i) completed from 9881-10015, (ii) completed from 10015-9955 as Irregular correction and (iii) may be completed at 10191 or still in progress.

Now, we need to analyze the progress of wave (iii) of (3) started from 9955 separately on lowest possible time frame chart to calculate short term levels.

Elliott Wave Analysis of Nifty on 5 minute chart

Elliott Wave Analysis of Nifty on 5 minute chart

This is 5 minutes time chart of Nifty covering bounce after 9955 which I marked as start of inner wave (iii) of (3) on 30 minute chart.

This bounce again seems impulsive with inner wave 1 completed from 9955-10036, wave 2 completed from 10036-10007 and wave 3 may be in progress from 10007.

23%-38% retracement of progress of wave 3 of (iii) is placed 10147-10020. So, 10147-10020 is the normal range of immediate support and 10020 is immediate breakeven point below which we can think of any short term reversal.

Outlook is still bullish for short term as short term wave pattern is indicating wave (iii) of (3) in progress.

Conclusion

Nifty achieved 10178 on Friday which we calculated 2 weeks when Nifty was around 9700. But we could not make full use of the bounce because I failed to identify an “Irregular Correction” at 9955 and missed last 200 points bounce.

Now, Immediate outlook is still bullish as wave pattern is indicating some sort of wave (3) in progress and upper range for top cannot be calculate because there is no limit for projection of wave (3). Any expected upside range can be calculated only after seeing a small correction.

On downside, 10120 is the short term breakeven point below we can expect any short term reversal whereas 10072 is the medium term breakeven point below which we can think of any medium term reversal.

Trading Point of View:

Now, short term trading strategy is “Buying on Dips” as longs as Nifty is trading above short term breakeven point 10120 and next 10072 is the medium term breakeven point.

Safe entry range for buying is near 10120 using stoploss some points below 10120 (can be 10099) for minimum target of new life time high. And selling can be done only in Nifty breaks lower below 10120 (stoploss and targets can be calculated after breakdown only). Otherwise experience traders can plan their own trade based on the conditions explained.

And selling advice cannot be given at these levels because we can’t calculate stoploss of selling. So selling can be avoided until we see any confident bearish pattern.

Tags: , ,

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"