Nifty:Different Labels

Simplest of all:

Enthusiastic Bulls:

Enthusiastic Bears:

Realistic Trader---moving wave to wave---

So a corrective to 5136-5306 ranging from 38-80% and then another Impulse upwards by minimum 105 should be our first play.
Then plan further trades----
why hurry?

Raghu

Nifty : EOD 30.3.2012

A fresh upwave has started from 5136 upwards and has seemingly completed its first subwave at 5306.
Now the crucial question is: where does the Impulse & Corrective shown above fit into higher degree Counts?
Or we can simply follow the waves to see which of the following two patterns get developed as we proceed:

Raghu

Trading Nifty on 30.3.2012

11.10AM
Today open above 5204.15 itself confirmed that the Corrective started from 5629 has got over at 5136.

Now ,lets have a look at the upmove from 5136 upwards:

Further details in EOD post

Nifty: EOD 29.3.2012

Continuing with yesterday's chart and Counts:

And C being a Diagonal;this C5<C3(=211)<C1(=259).
Therefore maximum this C5 can do is 5278-210=5068.
As C is a 3x3x3x3x3 Diagonal,C5 has to be a 3 wave form ,out of which
(i)=5278-5170 played out today
(ii) in play and has done 5170-5204 so far
(iii) has yet to play out.


Today it progressed as follows:

And C being a Diagonal;this C5<C3(=211)<C1(=259).
Therefore maximum this C5 can do is 5278-210=5068.
As C is a 3x3x3x3x3 Diagonal,C5 has to be a 3 wave form ,out of which
(i)=5278-5170 =108
(ii)  5170-5204=34
(iii) 5204-5136=68(=.63 of (i) thus minimum has been done.


But has this (iii) of C5 has got completed?
One way to confirm it is a tick above 5204.15


The other is to have a microscopic view:


Some time back, I had mentioned few forms of an Impulse in case of gaps. Let me repeat it here for the sake of clarity:

i.e. a gap-down is followed by a 3 wave upmove and a 5 wave downmove(in various forms)
And today,this (iii) of C5(=5204.15-5136.1*) opened with a gap down in following manner:

A 3 wave upmove after the gap down but the following 5 waves ( as labelled above) are not a CORRECT 5 wave form( as none of it is extended).


So in my view, the DOWNMOVE  AS C5 IS NOT OVER YET.


And I label the (iii) of C5, started from 5204.15 downwards as below:

And my favourite trade for Friday would be to short with a Stop Loss at 5204.2 and targets below 5136 but not below 5068.
Longs to be created as we go below 5100 with Stop-Loss at 5067.


Raghu

Nifty: EOD 28.3.2012

Continuing with yesterday's labels:

today, following pattern has been formed:

And C being a Diagonal;this C5<C3(=211)<C1(=259).
Therefore maximum this C5 can do is 5278-210=5068.
As C is a 3x3x3x3x3 Diagonal,C5 has to be a 3 wave form ,out of which
(i)=5278-5170 played out today
(ii) in play and has done 5170-5204 so far
(iii) has yet to play out.


An alternative labelling to this,however, indicates that C might have already played out fully:

However,as c5 has done less than 162% of c1, I am giving less weight to these labels.
Raghu

Nifty :EOD 27.3.2012

In Pushkar.
Am able to lay my hands on lap-top after almost a week, and the complexities of pattern have seemingly increased. Special Thanks to Sunny Hooda for his affectionate enquiries.
First of all a look at trendlines & momentum on Hour charts:

While the negative divergence in price-RSI while forming new lows shows a decreasing downside momentum, close of price above 5 Hr EMA(=5233) and 10 Hr.EMA(=5226) and x-over of 5/10 Hr EMA indicates reversal from downmove to up move.An indication that would be confirmed by breaking of the trendline.
Lets see what indications are given by Daily Charts:

No negative divergence on Price-RSI front;

Price closed below 5 sma(=5262) and 5 ema(=5254).

Only the Daily Candle has made a Higher High and Higher low. Otherwise no confirmation of Hourly charts in Daily charts so far.

And what does EW say?

And tentatively following channel should be used to locate the ends of C4 & C5

And a microscopic view of C4(from 5175 upwards) appears as follows:

So my favourite trade would be to go short at all rises with Stop Loss at 5297(Nifty Spot) and look for target not below 5085


Should become regular by 30.3.2012.

Raghu

Nifty:EOD 21.3.12

The upmove was anticipated.
But the breach of 5324 was not.
And now that 5323 has been breached via an Impulse,breach of 5498 has become a distinct possiblity.
Posting two charts to delineate the Counts as I understand them.

It does not feel nice to remain out of touch during mkt hours---today I was in a desert camp in between Jaisalmer & Jodhpur--- but cannot hit the bed before reading the waves.
And this leg 5446-5233 (which today has been labelled as X.c) was quite foxy. I have no hesitation in mentioning that I have not quite UNDERSTOOD  it.
Lets see how it fanned out:
Any C wave is supposed to be either a 5 wave Impulse or a 5 wave Diagonal.
A complexity comes as this Diagonal can fan out either as 5*3*5*3*5 or 3*3*3*3*3
And to see how this X.c=5446-5233 fanned out,lets do its microscopic analysis.

And so far no convincing label/pattern can be attributed to it-- it is still fluid?
May be more clarity would emerge by EOD 22.3.12

Raghu

Trading Nifty on 21.3.2012

A very interesting question has cropped up
When A of Corrective ABC is an Impulse, it signals ABC(as a whole) playing out a zig-zag wherein B would not retrace more than 80% of A ;
When A is a 3 wave form, B retraces 90-138% of A  and the Corrective ABC(as a whole) plays out a Flat.

But what happens when A is a Diagonal?
It seems,in such a case both the possibilities are open--i.e. ABC(as a whole) may play out either as a zig-zag or a Flat.
So far,I had observed only zig-zags (ABC) with A as a diagonal.
But yesterday, the diagonal a(5239-5297) was retraced more than 100% by b (and still continuing)--- with b(a) doing 5297-5233;b(b)=5233-5295;b(c) in action and likely to go below 5233.
Then c upwards would start---and most likely go above 5297 but not above 5323.

Trading Nifty on 20.3.2012

1.00PM
In hotel for Lunch.
Nifty seems to have played a complex (iii) of C
To recall:
C in play from 5498 downwards:
(i)=5498-5363
(ii)=5363-5433
(iii)=5433 downwards
sw1=5433-5305=128
sw2=5305-5340=35
sw3 in play from 5340 downwards
Its 1st subwave is playing out a diagonal
4340-5282
5382-5323
5323-5239
5239 upwards in play likely to go above 5297 but not above 5323.
So best trade would be to Short above 5300 with SL at 5324 and target min 100 points

2.15 PM
Get ready for shorting around 5300 SL 5324 target minimum 84 points down

At close:
Very complicated wave form in play.
4th of diagonal still not over.
So tomorrow also we shall do the same up-down in between 5230-5320

Nifty EOD 19.3.2012

Just reached Jaisalmer.
After check-in found out that 5200 was not tested.
My counts stand as follows:

And it means a gap down tomorrow.
(iii) of C is in progress from 5433 downwards.

Raghu

Trading 19.3.2012

In Bikaner,Internet very slow.

to me 5200 is very much on the cards today--
9.40 AM:
Best trade should be to Short near 5315-5320 with stop loss at day's high and target 5200.
Me not trading. Shall see you all in yhe evening.

Raghu

Nifty: EOD 16.3.2012

Seems to have been quite volatile day.
Though the end result looks pretty close to what was identified by me,intra-day volatility would have definitely caused turbulence among Nifty watchers.
All I would say is: Jai ho EW kee !!!
Now the total downmove from 5498 has completed a 3 wave form:

And on a higher degree,this pattern can be seen as:
Probability 1:

Probability 2:

And it has been my observation that on these points the gap-up or gap-down resolves the issue.
So no need to lose sleep over it.
See you all on Monday morning.

Raghu.

From to tomorrow morning onwards I am starting on a 2 wk tour of Rajasthan travelling through Jhunjhnoo,Bikaner,Jaisalmer,Jodhpur,Mt.Abu,Udaipur,Chittor,Pushkar and back.
Try to catch up with mkt every morning.But would not be able to trade.
Lalu Prasaad ji,will I be able to get your blessings?

Trading 16.3.2011

The first set of 5 waves to the down is either over or would be over around 5350-55.(Its confirmation would come with a tick above 5398

Those still holding shorts should either square them off at 5360 or keep at TSL at 5398.
A tick above 5398 would mean that first 5 wave set is over after playing 5498-5363=135 and would get a retracement of 38-80% thus upper limit is now at 5470.
The wave form expected to play out today has been shown in following chart::

Lets see how we open---
9.30 AM

10.25 AM

 Sadly today also I have to leave for my pending personal work.
Best of luck everyone.
Raghu

Nifty EOD 15.3.2012

So I hope today's downmove would not have caught any of my friends here off-guard and BELIEVERS would infact have made good use of it.
I wish to discuss in detail one striking aspect of market dynamics which was on display today.
Although it was mentioned during the trading hours as well but I wish to re-iterate that particular point to drive home the lesson that market very often reaches a point from where it can take any direction depending upon the news that is expected at that point in time.
At 10.35 AM I wrote:
Q
10.35 AM

Now,5470.1 is an important threshold.
Remaining below it and going below 5427.9 would confrim that this 3 wave form is getting transformed into a 5 wave form
So two important threshold points:
5427.9 to confirm that top has indeed been formed at 5498
5470.05 breached would mean another test of 5500

UnQ
Any positive news would have triggered an upmove by 100 odd points as an Impulse and our patterns were ready for it.But the negative news transformed the 3 wave form into a 5 wave one as the day progressed.
In this manner, the EW enthusiasts have to locate the thresholds within the pattern and plan/initiate/protect their trades.


Where do we stand now?

Now based upon the above chart if one buys OTM options then I would not call it very prudent. Why? Because there is many a slip between the cup & the lip.
The above chart can also be labelled as:

Thus net-net we have following common points in two probabilities:
1. Both of these point to down move;
2.Both of these show 5200 as minimum target.
Difference is in their forms:
while first Probability has the downmove as C a 5 wave form;
the second one has the downmove as B(b) a 3 wave form and this 3 wave form may be a complex one as well.
Being a Conservative,I would advise you not to go out and buy 5200PEs.Rather sell 5500CEs or buy In the Money PEs


Raghu

Trading Nifty on 15.3.2012

How do we stand?

Now the moot point is: has B(c) ended at 5498 or not?
1. Till we go below 5373,we can not conclusively say that B(c) has ended.
2. Even if we say that it has not ended,it has to go below 5433 before it begins its last upmove.
3.And this last upmove can not be more than 105 points.

While points 1 & 2 were explained in detail in yesterday's EOD post, point 3 has been derived in following manner:

So
1. keep Trailing stop loss for existing shorts at 5470.1
2.Book profits in existing shorts below 5433.
3.My advice is not to play longs and all rises to be used for entering into Shorts again--

9.27 AM: How have we opened?
TSL for shorts to be moved to 5447
Still better to cover shorts at 5425

10.35 AM

Now,5470.1 is an important threshold.
Remaining below it and going below 5427.9 would confrim that this 3 wave form is getting transformed into a 5 wave form
So two important threshold points:
5427.9 to confirm that top has indeed been formed at 5498
5470.05 breached would mean another test of 5500
11.00AM

SL for shorts now at 5448

Wait for 53770-75 for squaring off your shorts.
I am off for the day as some urgent personal matter has cropped up.
Jai Bajrang Bali !!!

Nifty : EOD 14.3.2012

First things first:
1.I got initiated into EW studies by my Guru Baaluji @ Wave Rider through MMB .I have not seen him but spoken to him over phone a few times.
2.When I asked him for Guru Dakshina, he simply said that you try to educate as many people about EW as possible.
3.My initiation to EW is only 12 month old and I started writing this blog from 13/8/2011. That shows in six months time I was able to grasp its fundas.
4.My illustrations may or may not have helped anyone,but it has DEFINITELY HELPED ME to have a better grasp on the subject.
5.The sort of compliments showered on me are embarrassing as I write for the twin self-interests I mentioned above.
6.As it does not involve any rocket science, any one can do it and in a very short span of time mentioned above.

Shall update EW observations very soon.
There are a few striking aspects of the upmove from 5171-5498:

1. There were four consecutive gap-ups of which two got filled the same day and two remained unfilled.
2. Being labelled as Corrective B,this kind of swift upmove was unexpected, though zig-zags are quite swift but still this looks exceptional.
3.Because of the gap-ups,it was not possible to delineate the fractals of B(a)=5171-5419 and B(c)=5327-5498. Only saving grace was fractals of B(b)= 5419-5327 which were clearly discernible.
4.In the absence of clear cut fractals for B(c),it was left to permissible proportions to find out the ending point  of B(c).And as discussed in the Pre-open post for today,the permissible range was 5480-5537.

But is a revisit to 5498+ levels possible to end this B(c) ? Or it has already ended?

B(c) has so far done 5327-5498* and the down-move from 5498 has taken a very clear 5 wave form(=5498-5438=60)as discussed in the Intra-day trade today.
For a revisit to 5498+ levels,the down move from 5498 has to be a 3 wave form and from the end of that 3 wave form a 5 wave form has to rise up and above 5498.
A 3 wave form down from 5498 would entail following counts:
a=5498-5438=60
b=5438-5470
c=5470- down by minimum 37.2 points (i.e. 5433) as a 5 wave Impulse or 5 wave Diagonal.
On charts this Probability can be delineated in following way:

The minimum mentioned for c=5470 downwards is 5433.
What is the maximum?
Maximum is 1.617*a(=5498-5438=60)=97=5373.
Thus my conclusion is that till we go below 5373, a top at 5498 would not be confirmed.
So all shorts to keep a Trailing Stop-loss(TSL) which currently is at 5470.1

Raghu