Further Elliott Wave Updates of Nifty for 27 Jul 2018

| July 27, 2018

This is Elliott Wave Analysis Report of Nifty for 27 Jul 2018 which I prepared and sent yesterday to clients. I am posting it late because there is change in wave counts and pattern with respect to my previous analysis report.

Nifty opened flat at 11132 and traded in 11125-11185 range with volatility. Nifty registered new life time high 11185 and closed at 11167, it was a volatile session with positive bias.

Yesterday, Nifty was expected to decline towards 10893-10756 range in coming days without breaking higher above 11327 but there were conflicts in internal patterns. 11151 was stoploss for existing shorts.

Selling position / shorts taken yesterday near 11148 was suggested to exit if Nifty touches 11151 (near entry levels). Trade had been existed in 5-10 point loss. No fresh trade was suggested because there were conflicts in patterns on different charts. Let’s have a fresh look at latest charts for further scenario.

This analysis report is covering move after 9951 and earlier wave counts are explained in my last “All Time Frames” analysis report Fresh Elliott Wave Analysis of Nifty on All Time Frame dated 03 Jun 2018.

Elliott wave counts of Nifty on daily chart

Elliott wave counts of Nifty on daily chart

This is daily time bar chart of Nifty covering bounce after low 9951 which I marked as start of wave ‘v’ on daily chart in my last “All Time Frames” Report. There is no change in wave counts on this chart.

It seems inner wave (1) completed from 9951-10229, wave (2) completed from 10229-10111 as Irregular Correction and wave (3) may be completed at 10929, wave (4) may be completed at 10417 as Simple Zigzag and wave (5) may be in progress. [Wave (4) retraced deeper than 38%).

Wave (5) already achieved 61% projection after breaking above 11022 and next 100% projection is placed at 11395 which may or may not be achieved, so we need to concentrate on its pattern now onward.

So, let’s analyze the progress of expected wave (5) started from 10417 on lowest possible time frame chart to check its pattern closely.

Elliott wave counts of Nifty on 5 hourly chart

Elliott wave counts of Nifty on 5 hourly chart

This is 5 hourly time bar chart of Nifty covering bounce from 10417 which I have marked as start of wave (5) on daily chart.

The wave first from 10417-10893 looks like a 3 waves [abc] move. So,  wave (5) may be progressing as Ending Diagonal Triangle (ED) [(3-3-3-3-3) or (abc-abc-abc-abc-abc) structure] with inner wave [i] of ED completed from 10417-10893, [ii] completed from 10893-10557 as Double Zigzag correction and wave [iii] may be in progress.

Wave [iii] already achieved normal 100%-123% projection whereas 161% projection is placed at 10327 which is the maximum limit for wave [iii] because wave [iii] of ED can never be extended.

Within wave [iii], it seems inner wave [a], [b] is completed and [c] may be in progress from 10605. And within wave [c], it seems inner wave (i), (ii), (iii), (iv) is completed and (v) may be in progress from 10925. Wave (v) of [c] achieved minimum 38% projection and next 61% projection is placed at 10217 which may or may not be achieved.

But wave [iii] is steep and sharp which is not normal within ED. So, I am leaving this pattern for time being and will wait for confirmation (ED will be confirmed if Nifty declined below 10893 without breaking above 11327). And I will concentrate on last wave (v) of [c] started from 10925 only.

Elliott wave counts of Nifty on 15 minutes chart

Elliott wave counts of Nifty on 15 minutes chart

This is 15 minute time bar chart of Nifty covering bounce from 10925 which I am expecting as start of wave (v) of (c) of [iii] on 30 minute chart.

Inner wave (1) may be completed from 10925-11076 (pattern is not clear), wave (2) may be completed from 11076-10935 and wave (3) may be in progress from 10935.

Within wave (3), it seems inner wave (i) completed from 10935-11054, (ii) may be completed from 11054-11023, wave (iii) may be completed from 11023-11157, wave (iv) may be completed from 11157-11113 and wave (v) may be in progress.

Wave (iii) of (3) is not extended, so wave (v) needs to be extended. Minimum 61% projection for wave (v) is placed at 11250 and next 100% projection is placed at 11335 which may or may not be achieved.

38% retracement of progress of whole wave (3) is placed at 11089 which is breakeven point on downside and same can be used for stoploss for longs.

Conclusion

For long/medium term,

Same as I explained in my all time frames report, Outlook for medium/long term is still bullish because Nifty is within the middle of wave (3) on largest wave cycle and there is Irregular Correction at top. Nifty has long way to go with occasional corrections (maximum 23%-38% corrections with 9918 as breakeven point and 8968 as pattern negation point). Nifty may not break below 8968 in any case in coming years before competition of larger wave cycle.  We need to revise whole wave counts if Nifty ever broke below 8968.

For Short Term,

Nifty is in positive zone as long as trading above 11089 and there is possibility for further bounce towards 11250-11335. Any reversal can be seen after breaking below 11089 only. Nifty if trade below 11089 for 15 minutes can result in further fall towards 10935.

I am ignoring the bigger pattern for time being because personality of wave is not supporting the pattern. And I was already confused with the combination of complex patterns last week.

We need to keep all these conditions while deciding next trade.

Trading Points of View:

According to fresh conditions on charts: –

We already had couple of wrong trades in last 4-5 sessions because of complex pattern. Although, we lost only 50-60 points in wrong trade as I suggest trade with small stoploss but still we missed the opportunities. So, we need to plan next trades safely.

Now, 11089 is breakeven point and Nifty if completes any corrective pattern near 11089 (in 11110-11089 range) then buying can be done using stoploss of 11075 expecting all time high as minimum target. But we need confirmation for pattern to enter the trade.

Nifty if trades below 11089 continuously for 15 minutes can result in further fall, but entry levels and stoploss can be calculated after breakdown only. So trade can be decided after breakdown only.

These are most probable trades I can suggest in these conditions, otherwise traders can plan their own trade based on the conditions explained above.

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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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