Wednesday, February 21, 2018

Stocks trading strategy and trades to win another CNBC TV18 Bull’s Eye trade show

I am glad to share across another win on CNBC TV18 trade show with substantial margin when the other contestants were negative:
12th February trades:  Stock tips – Buy: Abbott, SAIL, First Source solution Short: Glanmark Pharma
The week started with a Gap up in Nifty which showed the bullish nature in the market. Abbott was given a buy call when the prices were in favour with MACD and had shown a good rally in 1st hour of the market. SAIL & First Source started its week following NIFTY with a Gap-up which was a good sign to take a long position along with the confirmation of Accumulation & Distribution indicator which showed the buying pressure in both the stocks. Glenmark Pharma had ended with a Doji structure in the previous trading session after a strong selloff. Continuous red bars showed the decision of the market and so, I recommended a short on the Glenmark Pharma. All the stocks went in favour and rallied by more than 5% to 7%.
14th February trades:  Stock tips – Buy: Adani Ent, Cholamandalam Finance, L&T Infotech, Abbott
Nifty had opened with a bigger gap-up then its previous days Gap-up. Hence, I had bullish eye to select potential up-trend stocks. All four stocks that I recommended had followed Nifty to open with a big Gap-up. After opening Adani with 2 Gap-ups in the week, the stock showed a good call to go long. Also the stock maintained its level above 7day SMA. Cholamandalam and L&T Infotech started the day on a positive note bouncing on 7-day SMA making long green candles which indicated the potential up-move in the stock.
15th February trades:  Stock tips – Buy: Ashok Leyland, KEC, L&T Infotech, NCC
After Nifty opening with a Gap-up on the 3rd day, I selected all 4 stocks for long positions. Since the overall bias on Nifty was positive I selected all stocks for buy calls. Also IT cycle has turned positive and L&T infotech was outperforming with strong Elliott wave pattern.
16th February trades:  Stock tips – Buy: Bombay Dyeing, Pfizer. Short: Repco Home, MSumi Sumi
Nifty started with a positive note but could not survive the 4th Gap-up and plummeted for straight 4 hours. Repco Home and Mother Sumi were classic bets that showed sharp fall after opening. These stocks have been very weak and did not rally the previous days when Nifty was moving higher. This itself showed stark underperformance and they were supposed to start wave iii on downside.  In addition to that, both stocks were trading below their 7&14-SMA.
The above strategy clearly highlights the fact that knowing the internal Elliott wave pattern of individual stocks along with Nifty direction is extremely important. It is not necessary that you will make money by simply being long on any stocks in the current market. Stock selection based on Moving averages, Channels, Elliott wave and much more is required.
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Monday, February 19, 2018

What is Hurst’s Time cycles, its application on Nifty?

Hurst suggested that there are certain standard cycles which are universal and can be applied on any asset classes. Many cycle analysts often complain that cycles vanish without giving prior indication. The major reason being interaction of different cycles of varying magnitude.
The subject might look complicated but it is no different than Elliott wave principle. The major difference is Hurst Cycle analysis helps us to predict time and Elliott wave focuses more on price. This element of time can help us to forecast the Elliott wave pattern that can form in future.
As shown in below chart we have applied Time cycle on Nifty Daily chart along with Neo Wave. The important part of Hurst Cycle is that if you know that major as well as smaller degree cycles are citing towards probable bottom or top then you can save yourself from making wrong trade. In market “when not to trade is the key to success”.
Nifty daily chart:

The above chart clearly shows important areas when Nifty formed lows near the above cycle. We have turned bullish based on these lows. Also a few days or maybe two weeks prior the markets topped out. This time it was no different and we can clearly see it topped out in 2nd half of the cycle. So by applying cycle analysis you can know when important lows or tops should be formed.  
This study of cycle analysis is independent of price forecasting that we do using Advanced Elliott wave i.e. Neo wave.
Imagine the power you will have if Time cycles and Neo wave price pattern both are in sync and pointing towards same direction.
I have discussed in much detail about Hurst’s Time cycles in my latest webinar – You can watch it here
In addition to above we have been mentioning Nifty daily intraday calls in our trading research reports. Below are the past few days of Nifty calls given:
Anticipated in morning of 19th Feb 2018 – Short positions can be created below 10430 with 10480 as stop and target of 10390.
Happened: Nifty moved precisely as expected and achieved the target of 10390 immediately.
Anticipated in morning of 16th Feb 2018 – Short positions can be created below 10500 with day’s high as stop and target of 10460 levels. BANG ON!
Happened: Nifty has been moving precisely as expected. Prices broke 10500 and quickly reached the target levels
Anticipated in morning on 15th Feb 2018 – long positions can be created on move above 10550 with 10510 as stop and target of 10580.” BANG ON!
Happened: Nifty moved precisely as expected and crossed the target levels on upside.
Nifty research report – The above clearly shows how accurately intraday trading strategy mentioned in Nifty trading update has been working despite of all the volatility. Subscribe to Nifty research report here
Equity research report – Also we show the detailed Neo wave counts in our daily equity research report “The Financial Waves short term update”. Subscribe now to “The Financial Waves short term update” and see yourself where is Nifty and stocks headed from here on. Visit Subscription page here
Upcoming Training on Time cycles & Neo wave– You can learn these methods in the upcoming training on Advanced Elliott wave – Neo wave, Hurst’s Time cycles. All of these methods when combined together have resulted into brilliant outcome that you can see above. Also before the training itself, there will be FREE Elliott wave video links shared across that will ensure you can learn even the basics of technical analysis and Elliott wave well before the two days’ workshop. There cannot be better investment than this. Post the training Mr. Kyal himself will be more than happy to clarify the doubts by starting a special Discussion forum meant only for the attendees where you can post your personal charts and trades. Register NOWas only a few seats left. For more details visit Training on Time cycles and Neo wave or to block your seat today itself directly call / whatsapp on +91 9920422202. Trust me this can be one of the best investments you can make!

Friday, February 16, 2018

How to trade using Neo wave and Hurst’s Time cycles?



How to trade using Elliott wave, Neo wave, Hurst’s Time Cycles using 5 minutes to daily charts – Identifying trading opportunities on Equity, Commodity, Forex & Bitcoin. For more details visit : https://www.wavesstrategy.com/technical-analysis-training-on-elliott-wave-neo-wave-hursts-time-cycles-crypto-stocks/

Wednesday, February 14, 2018

What is difference between Elliott wave and Neo wave? Application on Nifty charts!

Neo wave is an Advanced Elliott wave method with more number of rules and newer patterns to increase the overall objectivity.
Orthodox Elliott wave was originally discovered by R. N. Elliott in 1930s. His original work mentioned that stock market does not move randomly but in systematic fashion that follows Fibonacci numbers and natural laws. This systematic movement in prices are in form of waves. Normally there are 5 steps forward and 3 steps backward resulting into a net progression which is valid for stock market as well. The concept cannot be just applied but one needs to understand the basic premise and certain rules to apply it objectively.
Any price movement as per basic Elliott wave is classified into Impulsive and Corrective. There are various patterns within these broader heads. Impulsive waves need to follow three basic rules:
  1. Wave 2 cannot retrace complete of wave 1
  2. Wave 3 cannot be the shortest of the directional waves 1, 3 and 5
  3. Wave 4 cannot enter into territory of wave 1
The above 3 basic rules if followed then the price movement under consideration can be classified as a normal Impulse wave.
However, when the market structure is complex there is possibility that the movement can be counted in many different ways. This can result into subjectivity and the entire purpose of wave theory can be lost. To overcome this limitation Neo wave was developed that has more than 15 different rules to define a simple impulse pattern. Following are a few of them:
  1. Wave 2 cannot retrace more than 61.8% of wave 1
  2. Wave 3 cannot be the shortest of the directional waves 1,3 and 5
  3. Wave 4 cannot enter into territory of wave 2
  4. There has to be atleast one extended wave which is going to be 1.618% of non extended wave. If there is no extension then the pattern under consideration is corrective
  5. One of the directional waves should subdivide
  6. Corrective waves should consume more time than the preceding impulsive wave
  7. Touch point rule: Out of 6 points not more than 4 points should lie on the channel
  8. …etc
The above shows only a few set of rules for an impulse pattern as defined by Neo wave. There are newly developed patterns as well which were never a part of original Elliott wave. To name a few are:
–   Diametric Pattern
–   Neutral Triangle
–   Extracting Triangle
–   3rd Extended Terminal with 5th Failure
These new patterns are equally important to understand because majority of the movement seen in the world equity markets are taking the forms of these patterns that were never covered in original work of R. N. Elliott
We take a step ahead and combine this complex study of Neo wave to that of Time cycles. It is not always that both the studies will be in sync but when they are indeed suggesting the same outcome that is the time that the trade setup is of very high accuracy and it just leaves only one probable outcome. These are the times when one can go all in with prudent risk and money management strategies which have the potential to give the best of the returns in shortest amount of time.
Below part of research was shown 01st February 2018 daily research report when Nifty was in the toping zone that too on the Budget day!
Nifty 60 mins chart – Anticipated on 1st February 2018

Nifty 60 mins chart – Happened & Anticipated on 2nd February 2018

Happened as on 6th February 2018:
Nifty 60 mins chart:

The above charts are self-explanatory and simply show power of Neo wave.
Following was mentioned on Budget day before markets opened on 1st February 2018
“It is best to trade systematically with 10920 as very important support and 11170 as important resistance. As the fall of past two days is overlapping without any momentum we might see positivity or atleast a retest of 11120 levels.” BANG ON!
Happened: Nifty touched high of 11117 before reversing for the month
On 2nd February morning research we mentioned that – it seemed to be a populist Budget like everyone expected but introduction of Capital gains is going to result an impact which is not yet discounted maybe due to artificial support. Trade carefully as the swings can still be big over next few days! Move above 11120 is must to resume the positive trend else break below 10878 will be strongly bearish!
Happened: Low at 10878 was broken and everyone knows the serious selloff resulted into price moving towards 10276 levels in less than a week.
The above clearly shows how understanding Neo wave pattern helped us to catch a top when majority were busy buying exactly at the wrong levels and wrong time. The fall also happened precisely towards the level of 76.4% retracement of the rise which was shown on the daily research report.
References are taken from “The Financial Waves short term update” daily research report which covers Nifty, Bank Nifty and stocks on rotational basis and “The Financial Waves Monthly update” that shows medium to long term perspective on Nifty, INR Pairs, Global Markets, Gold, other commodities. For subscription options visit Pricing Page
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Attend the most Advanced Technical analysis training on Application of Neo wave and Time cycles with practical charts on different time frames for intraday to positional trading and investments. This training will focus on the above methods along with lot of other studies which can be combined together to produce very high conviction trade setups. Register NOW For more details Contact US or write to us at helpdesk@wavesstrategy.com or call us at +91 22 28831358 / +91 9920422202

Monday, February 12, 2018

Equity markets can stabilize in this week after sharp correction. Expect range bound movement!

Following is the English transcript of the article published in Economic Times section of Navbharat Times by Ashish Kyal, CMT published today morning before markets opened.


Sensex Weekly Chart:

Equity markets can stabilize in this week after sharp correction. Expect range bound movement!
Indian Equity markets showed sudden and sharp reversal from the start of the month. Prices decline after the Budget session on 1st February. Sensex made life time highs near 36444 and made a low near 33482 on 6thFebruary. This was a fall of nearly 2960 points in just a few days of time. The selloff cannot be contributed to Budget policy outcome alone but also to the weakness seen in Global equity markets. Introduction of Long term capital gains – LTCG did hit the sentiments of investors but this followed by global equity selloff resulted into sudden decline on Indian equity markets.
Global markets – US Equity index – DJIA showed one of the biggest declines over past few days falling more than 12% in just over 2 weeks. Other major equity indices like UK index – FTSE, Hong Kong index – Hang Seng, Japanese index – Nikkei225 all showed sharp fall. Such systematic selloff of this magnitude was previous seen during the fall of 2007 – 2008. It is therefore important for investors to remain cautious and buy only stocks with attractive valuations.
Prices to Earnings ratio remains a concern – Price to earnings ratio (PE) remains a concern. This fundamental parameter touched 27.81 levels in January 2018. Such elevated level was previously seen during January 2008 before the crash. Many of the Midcap and Smallcap stocks have crossed the level of even 100. This clearly reflects that prices have deviated from their fundamental valuations and therefore correction after such big rally is a healthy sign.
Sharp depreciation in Indian Rupee – Indian Rupee depreciated sharply against basket of currencies GBP, JPY and EURO since start of 2018. Such sharp fall in INR against this major currency pairs risk the fear of money flowing out of the country to safer assets. It will be important to see if currency markets also stabilize over next few weeks.
Bond yields a concern – Bond yields across the global markets have been on a rise. With rise in inflationary pressure it is feared that interest rate cycle has also changed. Such reversal will eventually impact the Equity markets. In normal economic cycle during inflationary mode it is the Bond prices that top out first followed by Equity and then commodities. So, if Bond prices have reversed already, eventually the pressure will be seen in equity markets. Indian Bond yields have also risen steadily over past few weeks raising concerns that the interest cut cycle is over.
Week ahead – Given the above fundamental and technical insights looking at the overall price pattern there is possibility that Sensex can show some stability in this week. Prices have important support near 33480 on downside and resistance at 34900. This is the broad range within which we can expect prices to move. Investors and traders should maintain strict stoploss and buy only the stocks that are fundamentally sound and are trading at attractive valuations!