EW Analysis and Outlook of Nifty for 08 Nov 2017

| November 7, 2017

Nifty opened higher at 10477 and registered high 10485 but failed to sustain at higher levels and trade with huge negativity for rest of the day. Nifty decline more than 140 points from high to register day’s low 10341 and closed 101 points down at 10350.

Yesterday, I mentioned that one more bounce above 10490 is expected but higher levels are warning cautions for small or big correction soon. I Suggested to buy Nifty 10300 Nov call in light quantity if get in 10413-10403 range with stoploss of 10389 expecting targets 10490 and above.

Expected bounce was happened at opening only but Nifty decline from 10485 (5 points short of 10490). Further Nifty bounced 40-50 points from 10413-10403 range and found repeated support around 10403 but finally breaks stoploss 10389 and declined further towards 10341.

Today I am covering bounce from 28 Sep 2017 low 9687 and earlier wave counts are explained in my previous analysis report Elliott Wave Outlook of Nifty for 16 Oct 2017 Onward

Elliott wave analysis on hourly chart

Elliott wave analysis on hourly chart

This is hourly time bar chart of Nifty covering bounce from low 9687 which I marked as start of new upside impulse.

May be wave (1) completed from 9786-9945, (2) completed from 9945-9881 and wave (3) may be in completed from 9881-10490.

23%-38% retracement of progress of whole move till wave (3) [from 9687-10490] is placed at 10300-10183. So 10183 is the medium term breakeven point below which we can expect bigger medium term reversal. [I calculated 23%-38% retracement of whole move till wave (3) and not of only wave (3) because retracement of wave (2) is negligible]

Medium term breakeven point is still far away. So, we need to concentrate on pattern of decline started from 10490 for short term moves and trading strategies.

Elliott wave analysis on 5 minute chart

Elliott wave analysis on 5 minute chart

This is 5 minute time bar chart of Nifty covering decline from all time high 10490 which I am expected as start of wave (4) on hourly chart.

The decline seems Impulse with wave (1) completed at 10429, (2) completed at 10485, (3) completed at 10341 and wave (4) or (5) in progress.

23%-28% retracement of whole move till wave (3) is placed at 10376-10397. So, 10397 is the breakeven point on upside above which we can expect upside reversal and 10376-10397 is the range from where Nifty can decline again. 10376 is already achieved and Nifty declined exactly from 10376.

If wave (4) already completed at 10376 then minimum 38%-61% projection is placed at 10319-10283. So, 10319-10283 is the minimum targets range on downside if wave (4) already completed at 10376.

Conclusion

Nifty was warning small or big correction from 10490-10530 range which happened today and short term breakeven point is broken. Next medium term breakeven point is at 10183.

For short term, outlook of Nifty is negative with upside breakeven point at 10397. And there is possibility for further decline towards 10319-10283 in coming sessions. Overall 10397-10283 is the normal range to decide trade.

10183 is the point below which we can see any bigger medium term reversal.

Trading Point of View:

Nifty broke short term breakeven point and short term outlook change to negative now. Short term trading strategy must be “Sell on Rise” keeping downward targets of 10319-10283 and stoploss above 10397 (some points above 10397). Any longs can be decided above 10397 only.  Breakeven point 10397 will not be valid after achieving 10319.

I am not suggesting any exact trade because Nifty is at middle of 10397-10319 and risk reward is not good. Traders can decide their own trade based on the conditions explained above if get low risk opportunity.

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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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