Further Elliott Wave Analysis Updates of Nifty for 13 July 2017 Onward

| July 12, 2017

Nifty opened mild higher at 9807 and bounced further to register day’s high 9824 and traded in narrow of 37 points between 9787-9824 for rest of the day. Finally Nifty closed 30 points up at 9816.

Yesterday, 9758 was breakeven point on downside below which further decline towards 9643 was expected and 9807 was breakeven point on upside above which bounce for new high above 9830 was expected. Also suggested to Sell Nifty in 9795-9807 range with stoploss of 9809 but Nifty opened above upside breakeven point and suggested trade was negated. Let’s have a fresh look at latest charts for further scenario.

Today I am analyzing bounce from 26 Dec 2016 low 7893 and earlier wave counts are explained in my “All time frame” analysis report Elliott Wave Analysis of Nifty using All Time Frames

Elliott wave analysis of nifty on daily chart

Elliott wave analysis of nifty on daily chart

This is daily time bar chart of Nifty covering bounce from 24 Dec 2016 low 7893. This is the same chart with explanation which I posted in last analysis report because there is no change in wave counts.

I am not showing any wave counts on this chart because the bounce from 7893 is straight, steep and without even 23%-38% and I am not able to identify its inner waves. But this bounce is still carrying the personality of some sort of wave 3.

I added this chart just to calculate Fibonacci levels. So, 23%-38% retracement of whole move (from 7893-9830) is placed at 9372-9090. So 9372-9090 is the expected targets range if any bigger correction is started.

Otherwise, we can expect a minimum correction of 400-500 points whenever correction starts and we can identify medium term waves clearly only once correction of 400-500 points happens. But there is no way to calculate exact top at this moment of time.

The only clue we can get from this chart is that there is new upside impulse started from 9448. So, we need to concentrate on analyzing this upside impulse to calculate short term moves.

Elliott wave analysis of Nifty on 15 minute chart

Elliott wave analysis of Nifty on 15 minute chart

This is 15 minute time bar chart of Nifty covering bounce from 9448 which I am expecting as start of new Impulse.

It seems wave (1) completed from 9448-9650, (2) completed from 9650-9643 as big Irregular Correction and wave (3) may be in progress from 9643. [Earlier I was expecting end of wave (3) at 9650 and start of wave (5) from 9643 but further waves are indicating much higher levels which is abnormal for wave (5). So, maybe it is wave (3) started from 9643 rather than wave (5)]

Now within wave (3), it seems inner wave (iii) completed at 9830, (iv) completed at 9778 and wave (v) may be in progress from 9778.

Minimum 38%-61% projection for wave (v) is placed at 9849-9893 which is expected target range on upside although it can extend further higher.

And 38% retracement of wave (iii) of (3) is placed at 9758. So, 9758 is the point below which we can think of Short/Medium term reversal.

Now, we need to analyze the progress of wave (v) of (3) started from 9778 to calculate immediate stoploss and levels.

Elliott wave analysis of Nifty on 5 minute chart

Elliott wave analysis of Nifty on 5 minute chart

This is 5 minutes time bar chart of Nifty covering bounce from 9778 which I marked as start of inner wave (iii) of (3).

It seems inner wave (1) of (V) completed from 9778-9822, wave (2) completed at 9788 and wave (3) of (V) may be in progress. Further wave (3) seems within its inner wave (iii). Please look carefully at wave counts on chart.

End of inner wave 1 of (iii) of (3) on this chart is at 9812 which we can use as immediate stoploss for longs because wave 4 cannot overlap 1.  And further, end of wave (2) 9788 is next stoploss in case any Irregular Correction forms at the end.

Conclusion

Same as I explained in my last analysis report, Nifty bounced about 2000 points steeply (from 7893-9830) without even 23% correction in between which is making it difficult to identify inner waves and I am unable to conclude which wave is actually going on within this bounce. We need minimum 23%-38% correction of this bounce for clarity in waves and that 23%-38% correction will be around 400-600 points. Until then, we need to concentrate on very last impulse started from 9448 for short term moves.

For short term, 9758 can be referred as breakeven point on downside below which we can expected further decline towards 9643 which further can extend towards 9372-9090. And Nifty has possibility to bounce further towards 9849-9893 which can extend even further.

So, overall short term outlook is still bullish and we can think of any reversal only after a break below downward breakeven point after confirming with the pattern.

And 9812 can be uses as very immediate stoploss for longs, 9788 can be next stoploss for longs in case of any Irregular Correction at the end. But, breakeven point below which we can think of any reversal is 9758 only, so we can plan any shorts below 9758 only.

Trading Point of View:

The safe trading strategy according to conditions on charts would be: –

  1. Buying Nifty if break above 9824 (today’s high) using stoploss of 9811 (1 point below 9812) expecting minimum targets range 9849-9893 which can extend even higher. Keep trailing stoploss of 38% retracement of whole bounce started for 9788 [start of wave (3)] to carry the trade further.
  1. Any shorts can be planed after break below 9758 only Or after seeing any other reversal pattern at top.

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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"