Nifty EOD 30.11.2011

My today's morning charts,after a lot of deliberations on 5 min,15min,30 min & hourly charts had proposed the following counts for today:

However,the very first tick on Nifty( opening at 4766) invalidated this count as below 4771 was not allowable in this count( A3(iv)entering A3(i) territory).

It confirms again that the foxy nature of 4th wave for which a range of 4640-4920 was easy to define but the pattern to be played within this range is most difficult to decipher.

So here I am with a clean slate again:

Many Counts have been proposed for this pattern by my peers.Most popular being the following:

However a 3*3*5 zig-zag(as A) is not acceptable to me.

So I prefer to keep my slate of pattern PLAIN AND UNCOUNTED and would prefer to wait for one-two more days before coming out with a convincing set of Counts.

Raghu

Nifty:Beginning 30.11.2011

This is yesterday's 3min Nifty chart and I am not able to conclusively say which wave comprises of 3 sub waves and which one comprises of 5 waves.

So I shift to a 15 min chart:

and find it better. Lets look at 30 min chart now:

It does not confirm the 15 min chart where in the middle wave(4803-4866)was coming as a 3 wave but here it is not qualifying as a 3 wave.

Now lets come to Hourly chart:

And it clinches the issue for me.

This whole exercise has been illustrated to demonstrate the difficulties & pit-falls in arriving at the correct labelling( and still there is no gurantee that THIS IS the correct one) and now we have to fit it in the previous Counts:

Thus it alters the Counts given in yesterday's EOD post which now stand corrected as:

Wave A(5 wave from):

A1=4639-4708=69

A2=4708-4669=39

A3 in progress as a 5 wave;

Can be anything from 1.62*A1 to 4.25*A1 (i.e. from 112 to 294) so far:

(i)=4669-4771=102

(ii)=4771-4693=78

(iii)=4693-4864=171

(iv)=4864-4787*

(v) to the up by 102 points likely today.

Raghu

Nifty:EOD 29.11.2011

Starting with yesterday's chart:

And now putting today's chart alongside for easier comparison/continuation:

And so our fractals for Corrective SW4 now stand as:

Wave A(5 wave from):

A1=4639-4708=69

A2=4708-4669=39

A3=4669- 4866=197

(i)=4669-4771=102

(ii)=4771-4693=78

(iii)=4693-4864=171

(iv)=4864-4803=61

(v)=4803-4866=63

A4 in progress, 4866 downwards and most probable target for it=38.2% of A3(=197)=75=4790

although the downmove has tested 4787 but not as a 3 wave but as a part of a 5 wave:

May be SW1 of a 3 wave A4 is in progress as a 5 wave form and should be ideally ending at 4785.

Thus tomorrow may be a day when A4 will fan out beteen 4780 to 4870.

Now lets have a look at the Daily Nifty charts as well.

And on seeing the Daily Charts one may very well argue that SW4 is over in following way.

I would not argue---EW has subjectivity inherent to it.

And, therefore, I always say:

"To each his own"

Raghu

Tata Motors: An EW Perspective

Above Count has a lacuna.

It is showing ABC as a zig-zag with A being a 3 wave. As per my manual EW Principle by Prechter & Frost, a zig-zag has to be 5*3*5 and if A is a 3 wave then the corrective should proceed to do a Flat.

As we donot have a Flat in the making, we have to say that a Double zig-zag should be in the making with following labels:

So currently we have Y.B in play as a zig-zag(5*3*5) which should logically take us past 208 but not above 216.

Raghu

Hindalco Charts:An EW perspective

Above chart is self explanatory.Only point that I wish to emphasise here is that as W3 was a huge extension over W1, W5 might get truncated and so a low for A might be in place already.

EW & Candles: Follow-up on Mundra Port

On Friday,I had put up this ostensibly Bullish Engulfing Candle chart of Mundra Port and after

seeing it in EW microscope

commented:

Q

Thus there seems to be no more space for further upmove as a 3 wave zig-zag is nearing completion.

UnQ

And see what happened today--- though Nifty moved up by 150 points,this stock barely moved.

Although the main purpose of this blog-post was to illustrate how EW can help in confirming or negating the indications given by Candles, it would remain incomplete without answering the "natural query" -- Should it be shorted then?

Yesterday I had given the answer-"YES with a SL @129" and proceeded to give following count as the "reason":

Q

So it clarifies that the upmove noticed on Friday was a sw4 of the downmove( 5 wave) started from 139.8 on 18.11.2011. Making the count as:

UnQ

But today I would not be that categorical as market prudence in view of huge upward momentum as well as the extended 3rd wave(325% of 1st) suggest that the "ideal" 5th wave may not occur at all at such a small degree(compensated by hugely extended 3rd.

-Then what should be done?

On hourly charts this abovementioned Count looks like:

And the count now becomes:

139.8-132.55=7.25

132.55-139=6.45

139-115.4=23.6(325%)

115.4-127.4*=12( 50.8%)--as a 3 wave form.

Thus this 115.4-127.4=12 has retraced more than 50% of its prev wave. A bit incongruent as its retracing more than 38.2% was difficult. Also its internal fractals now suggest (pl see chart above) that going above 128.8 would mean its turning into a 5 wave.

So all shorts to have a SL at 128.85 and one should go long above 129.

Very detailed explanation has left me exhausted so more of it on some other occasion.

Good Nite.

Raghu

Nifty EOD 28.11.2011

So of the alternative probabilities mentioned on Friday,one got matured today and it was:

Today's Nifty move was bulid on this Probability and we are in a 5 wave A form which has following labels:

And so our fractals for Corrective SW4 now stand as:

Wave A(5 wave from):

A1=4639-4708=69

A2=4708-4669=39

A3 in progress as a 5 wave;

Can be anything from 1.62*A1 to 4.25*A1 (i.e. from 112 to 294) so far:

(i)=4669-4771=102

(ii)=4771-4693=78

(iii)=4693-4859*=166(163%) thus A3 has covered 190 i.e 2.75*A1 and here we have to take help from classical TA as this (iii) has done the minimum 1.618*(i) prescribed by EW but max. limit mentioned in EW analysis says that it can go much further.

So lets come to the Daily Nifty chart:

While this upmove has breached all "preliminary " trendlines & channels shown in the chart,one resistance band of 4885-4915 is expected to "contain" this A of SW4.I suggest to all fellow readers not to take short positions in anticipation.

Raghu