Nifty may go down
Nifty Analysis as on 13/09/20
My Nifty analysis has changed drastically after looking at the current pattern. Currently Nifty was undergoing a rising wedge pattern. So before analyzing further let us understand what is rising wedge pattern.
Rising Wedge Pattern
As the name suggests, a WEDGE shape occurs when the two boundary lines are converging. For the rising wedge, the lines are slanted upwards. It takes typically 3 to 4 weeks to complete. Breakouts occur normally at two-thirds of the way to the apex of the converging lines. After the breakout, prices move rapidly and usually go back to where the wedge began. If the trend of the market is the same as the breakout, the movement is even stronger. Wedges often occur at major turning points.
Now from a low of 7511 rising wedge pattern has started. I was thinking that from low of 8806 wave 5 has started and accordingly I was counting Elliott Wave Count. But that counting was wrong. Actually from a low of 7511 wave B of 4 of 5 was started and which is ended at a high of 11794. Now refer to the chart below.
At 12430 I count as the end of 3 of 5. At 7511 it is the end of A of 4 of 5. After the downward breakout to a rising wedge is confirmed I count 11794 as the end of B of 4 of 5. So now it is clear that the uptrend from 7511 to 11794 was B of 4 of 5 and not wave 5 of 5.
Now C of 4 of 5 can end above 7511 if it is the failure of C or can end above 6357 as 6357 was the end of 1 of 5 and as per Elliott wave rules end of 1 of 5 and end of 4 of 5 do not cross.
As wave C of 4 of 5 is an impulse correction, it has 5 parts like
1. 1 of C of 4 of 5 – downward direction – subdivided into 5 waves
2. 2 of C of 4 of 5 – upward direction - subdivided into 3 waves
3. 3 of C of 4 of 5 – downward direction – subdivided into 5 waves
4. 4 of C of 4 of 5 – upward direction - subdivided into 3 waves
5. 5 of C of 4 of 5 – downward direction – subdivided into 5 waves
Total there are 21 waves and out of that as per my counting wave 1 of 1 of C of 4 of 5 going on. Though we are not able to count all this correctly, Nifty may go back to 7511 and if not supported then 6357 if the above analysis is confirmed.
If you see our share analysis software, Bank Nifty has already given 34 DMA sell signal and Nifty is near to LT sell TP. If Nifty gives 34 DMA sell signals then the above analysis will get confirmed. So we will wait for that. Till that as I suggested in the meeting sell your holdings if you get 34 DMA sell signals in our software. You will get a very good price to buy again after completion of C of 4 of 5.
If you are trading in the future then just sell when you get 34 DMA sell signal and remain in short till you get 34 DMA to buy signal. If you are trading in options then avoid buying calls and in puts keep on booking profit than keeping book profit.
Of course, you will get all updates regarding the Nifty movement unless and until you are a member of the Zoom Meeting Group. So be connected with us as a huge earning opportunity in short selling is going to come ahead. We will grab it. Also, forward this message to your contact and invite for the Zoom meeting.
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Always at your service
Nitin Shripad Joshi