Nifty Elliott Wave Analysis and Updates for 22 April 2015

| April 21, 2015

We witnessed a volatile session today with volatile swings both side. After opening Gap down Nifty bounced sharply from 8405 to 8469 (from 161% projection of wave (c)) followed by decline till 8383. Nifty again bounced till 8462 from low followed by 110 points decline till 8352 before closing 70 points negative at 8377. Let’s analyze the latest charts of Nifty.

Elliott Wave Analysis of Nifty for 22 April (Chart 1)

Elliott Wave Analysis of Nifty for 22 April (Chart 1)

This is 15 minutes time bar chart of Nifty covering move after last low 8269 which I am expecting as completion of an impulse followed by correction.

It seems, an impulse is completed at high 8844 as shown on chart followed by a start of correction from top. Wave counts within this impulse are marked on chart. The correction from top 8844 already achieved 78% retracement after breaking 8392 which is more than normal retracement of 61%.

Conditions are not normal which suggests staying cautious and concentrating on very short term counts only.

Let’s see the decline after top 8844 on separate 5 minutes chart to conclude its limitations:

Elliott Wave Analysis of Nifty for 22 April (Chart 2)

Elliott Wave Analysis of Nifty for 22 April (Chart 2)

This is 5 minutes time bar chart of Nifty covering decline after 8844 which I am expecting as start of correction after an impulse.

It seems,

  • Wave (a) completed from 8844 to 8646
  • Wave (b) completed as “abc” from 8646 to 8724 which retraced slightly above 38%.
  • Wave (c) is in progress or completed which projected more than 161% but still there is no confirmation of its completion.

We rarely see wave (c) projecting more than 161% in Simple Zigzag, but possibilities are always there which can’t be ignored. As I am expecting the whole move after 8996 progressing as Complex Correction and inner waves of complex corrections often exceed its normal projections/retracements. So here, we need to concentrate more on Wave Cycles. Let’s have separate look at wave (c) started from 8724.

Elliott Wave Analysis of Nifty for 22 April (Chart 3)

Elliott Wave Analysis of Nifty for 22 April (Chart 3)

This is 5 minutes time bar chart of Nifty covering move after 8724 which I am expecting as start of wave (c). I seem, inner waves 1, 2, 3, and 4 of (c) are completed and wave 5 is in progress. Wave 3 is highly extended here and wave 5 fulfilled its minimum requirement of breaking end of wave 3. But wave 5 is still short of its minimum Fibonacci projection of 38% which is placed at 8331 where as 61% is placed at 8251 (it is below the previous low of 8269).

We need to concentrate more on this very short term chart as medium term charts has exceeds normal conditions.

Other Possibility:

And if this pattern is 1, 2 and 3 rather than ABC then we can see more low levels. We need to see how Nifty reacts after completion of expected wave (c).

Reflex Point or Trend Reversal Confirmation Point in Elliott Wave Theory: 

Many times I mentioned in my reports that “there is no sign of reversal yet”. Some of my student/subscribers asked me how to confirm reversal. So, I am giving an example of Reflex Points and Trend Reversal Confirmation here on above chart. Please see Chart 3

In a Corrective “abc” decline, the start of inner wave (5) of (c) called reflex points. After completion of wave (5) of (c), an impulsive wave must complete above that reflex point to confirm reversal. And we can take entry at corrective decline after that impulsive wave which completed above Reflex Point.x

We must be cautious for new low if we don’t see any impulsive wave completed above reflex points.

In above chart, start of wave (5) of (c) is 8462. So, reflex point is 8462 and an impulsive wave must complete above 8462 to confirm reversal. But the entry will be only at corrective decline after that impulse which completed above Reflex Points with low as stop loss.

Sometime, we see an impulse completes above Reflex Point but price still achieve new low. These cases are mostly Irregular Corrections where impulse which we assuming completed above reflex point is actually wave (c) of (4) which progressed as Irregular Correction.

Conclusion:

If we see precious impulsive move from 8269 to 8844 then next decline should be ABC Correction.   And if the decline is really an ABC correction as I shown on charts then it already achieved more than 61% retracement and wave (c) also exceeds its normal limits. But still there is no sign of reversal yet.

The pattern formed at closing today is suggesting Gap Up but we need to see if it sustain above 8400 or not. Possibilities of touching 8331 are there as it is minimum 38% projection of wave (5).

Personally, I would like to wait for clear signal to initiate any short term trade. Intraday swing trades can be done after identifying smaller wave’s patterns on 5 minutes chart.

As I already mentioned in my previous reports. I am expecting here the possibilities of Complex Correction on bigger time frame and Complex Corrections are always confusing and difficult to trade.

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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"

Comments (12)

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  1. Jigar says:

    It seems that the IMPULSE has started from 8293 (completed wave-5 of C) and on its way to cross the REFLEX point of 8460.

    At close, it seems that Impulse is in its wave-4 and should cross the REFLEX point tomorrow, at opening, followed by a corrective decline (wave 2 or B)…..

  2. RAJEEV says:

    sir please reply my question

  3. Rajan says:

    bottom out 8292 Or possible new low 8159-35 ? deepak ji

  4. Rajeev mittal says:

    can we say that wave 4 was over at 8269 or the move from 8269 to 8844 is a part of complex correction?? if move from 8269 to 8844 was an impulse than this correction should not go below 8269 and market should go for new high in the fifth wave pls reply

    • Deepak Kumar says:

      Dear Rajeev Mittal,

      I am not replying because it is impossible for me to make you understand about the fact unless you have read my book. Possibilities for Complex Corrections are still there. Market can move anywhere and may be wave 4 completed at 8269 but I can’t ignore the possibility of Complex Correction till possibilities are there. That is the reason I am showing only short term counts.

      Even if Nifty goes for new high, it need to start from bottom with reversal. May aim is to catch that reversal from low and take position, rest market will show where it is going. I never analyze for targets, I analyze for stop loss.

      • RAJEEV MITTAL says:

        DEAR DEEPAK JI
        I JUST WANT TO KNOW THAT MOVE FROM 8269 TO 8844 IS AN X WAVE OR NOT ??IF IT IS, THAN WHETHER IT HAS TO BE IN FORM OF ABC OR 12345???

  5. sanjeev jha says:

    Dear deepak, picture is still hazy even after reading this report.
    Nifty is really testing EW practitioner this time. It has even forced you change your wave counts already twice in fall from 8848.
    And even now counts shown in this report lacks clarity at two points.
    1st at 8654 marked as start of blue wave (iii)
    and secondly at 8469 marked as red 4 of blue wave (v).
    It would be very good for your prospective subscriber if you could put in detail internal counts as well.It would give strong credentials to your report.
    thanks and regards.

    • Deepak Kumar says:

      Dear Sanjeev Jha,

      Yes, picture is still hazy, that’s what I mentioned many times in this report. That’s my the title of reports is “Nifty Elliott Wave Analysis and Updates for 22 April 2015” and not “Nifty can show following levels without breaking following levels”. Market is not same every day.

      It is not that “Nifty is really testing EW practitioner this time. It has even forced you change your wave counts already twice in fall from 8848”. Market test EW practitioner and other TA every time. The master is market, not Elliott Wave Theory Practitioner. Yes, I am changing counts frequently because it is only way to go with maximum probabilities. I never know if my count are correct, I just go with the probabilities and market shows later if counts are correct or not.

      And it is your thinking that “And even now counts shown in this report lacks clarity at two points.
      1st at 8654 marked as start of blue wave (iii)
      and secondly at 8469 marked as red 4 of blue wave (v).” But these are most probable counts as per my understanding of Elliott Wave Theory. And my subscribers who have my book knows why I marked these counts. Even if they have any doubt then I am always keen to explain them separately by email.

      And regarding Inner counts, I already broke whole decline in two charts and also counted inner waves till 3rd lower degree. It is not possible to count even minute wave, we need to leave minute waves on Fibonacci Ratios and usual wave structures sometimes.

      Most of the analysts and traders fails in Elliott Wave Theory and find it confusing because they have wrong approach towards it.

      It s not about counting waves correctly every time and to be confirmed every time if your counts are correct, only God can do that.

      The key is to go with the maximum probabilities and wait for clear picture and wait till when you have confusion and hazy picture. Market is never easy everyday but it gives you great clear picture often/occasionally. And we must wait when picture is hazy and never hesitate to take risk when picture is mostly clear.

      Elliott wave Theory is not to make accurate predictions, it is to identify low risk high reward opportunities, it is to make money. And trading is not to make money every day, trading is keep money with yourself and take risks only when your are seeing great opportunities no matter if you do just 4 trades a month.

      If you are expecting a clear picture every time from an Elliott Wave Practitioner then it is against the nature, Human can never do that otherwise I could be richest person on this earth. This report is just homework and to see probabilities so that we can identify the real opportunity when it comes.

      And this is what I follow myself and teach my subscribers.

      • sanjeev jha says:

        yes dear, what you are saying is correct. No one can be sure about market every time.
        I was talking about inner wave count from reflex point shown in the second chart and since it broke 8405 i.e 76.4% retracement of rise from 8269 to 8848, it would have been prudent to show 1,2,3 counts also on this chart as an alternative, you have mentioned that it was an impulse from 8269 -8848, but alternative for it being an corrective move as ABC should also been shown on a different chart.
        sorry for bothering you again.
        regards.

        • Deepak Kumar says:

          Dear Sanjeev Jha,

          If you read the report carefully then I mentioned a line there,

          Other Possibility:

          And if this pattern is 1, 2 and 3 rather than ABC then we can see more low levels. We need to see how Nifty reacts after completion of expected wave (c).

          And As I said, my reports are specially prepared for my student for training. I intentionally leave some counts and calculation so that they try themselves. They can never learn EWT if they don’t try themselves and if I provide them everything.

          And about alternate counts. You can never earn money from market if you think of every alternate counts, As I said, I always go with the most probable counts and these are most probable counts I got after checking the probabilities of whole move started from 8996. I will change if this counts proves wrong.

          And this report is already of 800 words. If I try to explain every alternate counts and probabilities then report would be of 5000 words with more than 10 charts. Which is not possible.

          And again, most analysts fails in EWT because they always see alternate counts and confusion never ends. I learned to go with most probable counts. And it will be a lengthy article if I try to explain why these counts are most probable.