Through the above image I am trying to depict the following factors which I have been mentioning all along:
1.EW count (shown in red )as an Expanded Flat;
2.Descending trendline from previous highs of Deepawali 2010;
3.200DMA;
4.Momentum vide MACD (5,34,5)which is not showing any let up.
This C of the expanded Flat can normally do 1.618*A=5275 but the descending trendline and 200 DMA were supposedly the last post for it.
If Monday doesnot see a reversal,then Invalidation of this Count would also be not very far.
Let momentum guide us and please donot take any positions in anticipation---
Raghu
Dear Raghu,
ReplyDeleteMay I suggest something please.....If u don't mind!
The TL you have shown conntecting the lower highs from 6339......PERFECTO
Now if u pick up that same trendline and place it at the first REACTION LOW (5177)......abracadabra.........U have the WAVE CHANNEL in place.
A little deviation to illustrate the term first REACTION LOW
Highest high........6339......the most immediate low after that 5690.........
This is followed by a LOWER HIGH at 5181.
The low after this LOWER high = FIRST REACTION LOW (5177)
Now, if price action is contained within the two channelz............is traits of corrective wave in progress............
A DZZ or the rare TZZ would be RESTRICTED to move within these two channels........
In this case......a break of the lower channel = Intention to morph from corrective to IMPULSIVE
A break of the upper channel (imminent in this case)would mark the end of this corrective and launch of the next wave......
Examine the current wave in progress.......from the lowest point in the channel (4531)
is clearly an impulse and yes in this case BASED on the theory C of xpanded flat in progress......we are hitting the upper trendline approx just south of 5300
If this were to be C of expanded flat.......It should not go over 5282 (current location of upper channel).....Not this channel is declining at the rate of approx 17 points per week or roughly 17/5 = 3 points per day.
End of next week....Likely that the upper channel wud be approx 5282-17 = 5265
The week after that 5248 and so on.........
The moment this channel gets broken........4531 can be designated as the end of the first part of a corrective combo at a very large degree....
For Example ABC = W where 5177 is A, 5740 is B and 4531 is C
The next wave connector of a combo X at the same degree wud take a corrective form.....X.A (impulse) X.B(corrective) and X.C (impulse or ED)
IMHO X.A in progress and still not done with X.A.3
Two events that would validate this count:
1) This wave C of xpanded (current count) would be invalid when it does more than 261.8% (max allowed for C in an expanded)
161.8 mark is at 5275 and the 261.8 at 5735.......However violating the upper trendline is a no no as far as wave channelz are concerned. So the moment we are over the upper channel.......I'd scrap this xpanded C count officially........Unofficially I already scraped it :D
Also......If the current w5 were to be extended...it has so far done 153% of W1 (from end of W4 assumed at 4803)
And 120% of the net W1-W3...........
This W5 then still has room to run upto around 161.8 of net W1-W3 which placed it at 5362.
Will it do? I have no idea.
Another observation in the current move from 4531.........so far only one reaction low (4588 as W2)
4531 - lowest low
4800 - first high after lowest low
4588 - first reaction low (higher low)
After than......at this same degree....No reaction lows made.
IMHO under the curret situation......a close below 5130 can be considered a 2nd reaction low at the same degree as the move from 4531-4588 and this 2nd reaction low in all probability would be W4.
Hope I managed to Konfuze you.....Pardon me if I actually did so :D
Thanks WW for your kind contribution.
ReplyDeleteAnd donot worry about Konfusion part---we are used to it---and learnt to draw our juice from it as well--