Nifty Can Decline 100-120 Points from 10024-10039 Range – EW Analysis on 12 Oct 2017

| October 12, 2017

Nifty opened higher at 10042 and bounced further to register day’s high 10067 but failed to sustain at higher levels and declined sharply by more than 100 points to register day’s low 9955 and finally closed 32 points down at 9984.

Yesterday, I explained that medium term outlook is still bullish for bounce above 10178 in coming days but we need to wait for a correction towards 9900 to decide any trade as correction is expected. Expected correction happened yesterday; 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 counts of Nifty on 30 minute chart

Elliott wave counts 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. Wave (5) of (C) was extended which retraced completely.

Further bounce from 9687-10067 also seems impulsive which can be wave (A or 1). 38%-61% retracement of wave (A or 1) is placed at 9921-9832. So, we can expect normal decline towards 9921-9832 in coming sessions.

Now, let’s analyze decline from 10067 separately on lowest possible time frame chart to calculate deeper levels.

Elliott wave counts of Nifty on 5 minute chart

Elliott wave counts of Nifty on 5 minute chart

This is 5 minutes time chart of Nifty covering decline from 10067 which I am expecting as start of wave (B or 2).

The decline from 10067-9955 seems impulsive and this impulse can be wave (a) of (B or 2) as marked on chart and wave (b) of (B or 2) may be in progress from 9955. Normal 38%-61% retracement of this wave (a) is placed at 9997-10024.

Within wave (b), it seems inner wave [a] completed from 9955-9998, [b] completed from 9988-9970 as Irregular Correction and [c] may be in progress from 9970.

Normal 100%-123% projection for wave [c] is placed at 10013-10023 and next 161% projection is placed at 10039.

So, wave [c] can complete somewhere in 10013-10039 range o complete wave (b) of (B or 2) followed by wave (C or 3) for 9955 and below.

Combination of all inner and bigger waves is indication 10024 as reversal/resistance range from where we can expect 100-120 points decline [wave (c) normally projects 100%-123% of (a)].

Conclusion

The medium term outlook is still bullish for bounce above 10178 in coming days but there is possibility of decline towards 9921-9832 before further rise.

10024-10039 is the range on upside from where further decline towards 9921-9832 can be expected and pattern will be negated if Nifty breaks above 10067.

Trading Point of View:

Nifty if bounce towards 10024-10039 range then Nifty 10100 Oct put can be bought in 10024-10039 range using stoploss of 10068 expecting downward target 9921 which further can extend towards 9821.

There is possibility of bounce for new high above 10178 again from 9921-9832 range.

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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"