Friday, August 2, 2013

Nifty Trading Strategy and Scenario analysis

Nifty Trading Strategy and Scenario analysis
By Waves Strategy Advisors, For more information on various research products visit
Nifty has been moving in wide range with increase in intraday volatility. For traders volatility is good if it can be capitalized and the timing for entry and exit is prudent. We on daily basis publish Nifty trading strategy report that shows Nifty daily technical analysis along with Elliott wave counts and view. We also give a clear trading strategy for the day in “The Financial Waves Trading update” research on daily basis. In today’s report we have shown different plausible scenarios as:
Nifty 10 mins chart:

a.    Wave d is ongoing and yesterday’s low at 5675 was wave c of 2nd correction. The recovery we are seeing is just another wave x which can complete anywhere between 5730 and 5800 and the 3rdstandard correction on downside or sideways will begin. This will be completing entire wave d and after a week of consolidation wave …..will start towards…
b.    The other alternative scenario suggests that wave d is forming a flat correction and the down move from 6080 to 5675 is simply minute wave a of d which formed a double zigzag pattern. We should now have an upward move retracing atleast 61.8% of this down move i.e. go towards ……
c.     The 3rd scenario suggests that entire wave d is over at the low of 5675 and the final leg of triangle on upside has started taking prices towards ….. However wave d so far has taken only 6 days as against 19 days taken by wave c. So this looks a lower probable scenario for now.
In short, it is now crucial to observe if we can have closing above the previous day’s high placed near 5755 for a move towards 5800. Expect a range bound movement between 5675 – 5800….
Happened: Nifty moved exactly between the range as expected. Prices made a high of 5808 and low of 5676 in today’s trading session.
Trading strategy:
Mentioned in morning of 1st August: For today, Shorts can be created on rallies to 5775 with stoploss of 5810and for target of 5710. Long positions can be initiated on dips to 5700 with stoploss of 5670 and for target of 5770.” BANG ON!!!
Happened: Nifty moved on both sides protecting our stop levels and achieved the targets in today trading session. The low for today was 5676 and high was 5808!
Mentioned in morning of 30th July: On policy day before the announcement, in morning itself, we mentioned that “In current corrective environment it is better to adopt sell on rallies strategy. Nifty can be sold on rallies to 5860with 5920 as stoploss and target of 5750 as target."BANG ON!!!
Happened:Nifty made a high of 5861 and turned down making a low of 5747. Prices moved exactly as expected even on the event day.
The above are a few strategies on Nifty daily trading update. We will not claim that everyday the targets are achieved but trading is a probability game. We have warned our subscribers at major turning points. In markets not only making money is important but to protect it afterwards is the key to success!
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