This Elliott Wave Analysis Report of Nifty is further update on my last analysis report Nifty Can Decline 100-120 Points from 10024-10039 Range – EW Analysis on 12 Oct 2017 because pattern expected in last report is negated.
Nifty higher at 10011 and declined sharply just after opening to registered day’s low 9977 but bounced from lower levels and traded with huge strength for rest of the day. Nifty bounced more than 110 points to register day’s high 10104 and finally closed 111 points up at 10096.
Yesterday, I explained that medium term outlook is still bullish for bounce above 10178 in coming days but we can see a correction till 9921-9832 before further rise. I suggested buying Nifty Oct 10100 put in 10024-10039 range using exact stoploss of 10068.
Nifty declined from 10024-10039 range twice but bounced sharply above 10067 in last hour of trade and our stoploss was triggered. It was an Irregular Correction at top which I failed to identify yesterday. 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
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.
Further bounce from 9687-10104 also seems impulsive which is within its wave (5). Normal 38%-61% projection of wave (5) is placed at 10080-10157 whereas 10080 is already achieved and next 10157 is possible.
Yesterday I assumed impulse completed at 10167 and correction has been started. But Nifty bounced again after small correction, so may be impulse is still in progress. And the impulsive sharp decline from 10067-9955 which I was marking as wave (a) was actually wave (c) of Irregular Correction which I failed to identify.
Now, let’s analyze the bounce from 9955 separately on lowest possible time frame chart to calculate short term levels.
This is 5 minutes time chart of Nifty covering bounce after 9955 which I marked as start of wave (5) on 30 minute chart.
This bounce is again seems impulsive with inner wave (1), (2) completed and wave (3) may be in progress. Wave (2) looks like a Double Irregular Correction.
And within wave (3), it seems inner wave (i), (ii) is completed and (iii) in progress. Inner wave (i) of (3) is larger than (1) here.
38% retracement of progress of wave (iii) of (3) is placed at 10066. So, 10066 is immediate breakeven point on downside and same can be used at immediate stoploss for longs. Nifty if breaks lower below this breakeven point 10066 can fall further towards 10007-9955.
The medium term outlook is still bullish for bounce above 10178 in coming days and 9944 is medium term breakeven point below which we can expect any medium term reversal.
For Short term, Nifty is expected to bounce further towards 10157-10178 and 10066 is immediate breakeven point. Breaking lower below 10066 can take Nifty further towards 10007-9955.
Trading Point of View:
We already missed the perfect opportunity for awaited trade because of failure in identifying Irregular Correction. Even we lost some points in opposite trade. I was waiting for a correction to buy but I failed to identify opportunity when correction came.
Now, short term trading strategy is buying on Dips until Nifty achieves 10178 with 10066 as short term breakeven point and 9944 as medium term breakeven point.
Safe entry range for buying is near 10066 using stoploss some points below 10066 (can be 10059) for targets 10157-10178 and above. And selling can be done only below 10066 with 30 points stoploss expecting 10007-9955 on downside.