Nifty Elliott Wave Analysis and Outlook for 01 Nov 2016 Onward

| October 31, 2016

Nifty opened gap up on Muhurat trading at 8672 but failed to sustain at higher levels and declined straight way to register day’s low 8616 before closing 12 points down at 8625.

On Sunday, Nifty opened gap up as per expectations but failed to sustain at higher levels and trailing stoploss of 8631 triggered. Nov 8900-9000 Calls in light quantity were suggested to hold without stoploss. Let’s have a fresh look at latest charts for further scenario.

Today I am covering decline from yearly high 8968 whereas previous wave counts are explained in my previous analysis report Elliott Wave Updates of Nifty for 18 Oct 2016.

Elliott wave counts of Nifty for 01 Nov 2016

Elliott wave counts of Nifty for 01 Nov 2016

This is hourly minutes time bar chart of Nifty covering decline from 8968.

There is overlapping of waves within this decline which generally indicating it as some type of Corrective pattern, may be complex correction pattern.  Possibility of “Triple Zigzag” I have shown on chart with inner wave’s counts and Nifty needs to show one more low below 8506 to complete 3rd and last (abc) cycle if this correction is really going as “Triple Zigzag”.

I have just shown the possibility of an ongoing pattern making sure that all the rules are followed. But conformation may be after seeing a low below 8506 only. Otherwise, if this correction is already completed as “Double Zigzag” then Nifty needs to bounce from here only.

Important Observation: If this decline from 8968 is really is corrective and forming “Triple Zigzag” pattern then we can witness a very sharp and Non-Stop bounce for 8968 and above after completion of “Triple Zigzag”. And if it is last (abc) cycle of Triple Zigzag in progress then we can see very volatile and wild moves because Triple Zigzag correction mostly gives wild moves before its completion. But this is just the possibility I have mentioned to observe, conformation will be only after seeing its completion.

Read this explained article to understand everything about “Triple Zigzag Correction”: Triple Zigzag Correction of Elliott Wave Theory Explained by Deepak Kumar

Now, let’s have a separate look at the move after very last bounce from 8506.

Elliott wave counts of Nifty for 01 Nov 2016

Elliott wave counts of Nifty for 01 Nov 2016

This is 15 minutes time bar chart of Nifty covering bounce after 17 Oct 2016 low 8506.

The personality of the bounce from 8506-8736 looks impulsive and possible wave counts are explained on the chart. And further decline from 8736-8550 can be impulsive or corrective but it seems corrective (abc) by casual look as shown on chart.

The decline from 8736-8550 also retraced by 61% and pattern of retracement (bounce from 8550-8678) again looks corrective (abc) because of overlapping of waves.

Further calculation wise, 100%-123% projection of the upside impulse (8506-8736) is placed at 8780-8834 if correction is already completed at 8506. And 100%-123% projection of decline (from 8736-8550) is placed at 8492-8448 in case “Triple Zigzag” is in progress.

Overall, we can see a sharp decline towards 8492-8448 or sharp bounce towards 8780-8834 because wave (c) or (3) either side is expected. Further we need to wait for the signs of completion of correction for confident one sided trade.


There is no change for medium term, there is continuous overlapping or waves and repeated (abc) waves within the decline from 8968, so overall conditions are suggesting a new high above 8968 sooner or later either straightway from here (if correction completed as “Double Zigzag”) or after registering new low below 8506 (if Correction is progressing as Triple Zigzag). We need to trade with proper risk management to catch this move. Whereas, Nifty can also give a very sharp non-stop bounce for new high above 9868 if the correction started from 9868 completes as “Triple Zigzag”.

For very short term, a bounce for 8780-8834 or a decline for 8492-8448 is expected very soon but it is difficult to decide which way exactly. If Nifty decline below 8506 then we can get a very good opportunity to trade for 400-500 points profit with 50-60 points stoploss.

For Trading Point of View: –

For Medium Term, 8900-9000 calls in light quantity if taken in 8648-8593 range can be hold without any stoploss because there is possibility of a good bounce soon towards 8800-8968 either from present levels or after a low below 8506 as explained above. Further this trade can be managed or position can be increased if we get further clarity in pattern which will be notified in further reports.

For Intraday or short term, no safe trade can be suggested in these conditions because there is continuous overlapping of waves on short terms as well medium charts and patterns are changing frequently. Just as I expected either a gap up or a good bounce after opening in my last report, which happened exactly as per expectations but there is no way to predict that sharp decline after gap up. Current conditions needs continuous watch on waves during market hours to manage trades which is impossible to predict a day in advance.

Safe Traders can wait for perfect opportunity because Nifty is in consolidation mode from last 2-3 months and we can see a good one sided wave very soon.

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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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