Nifty has continued to move in a range irrespective of the policy announcement.

Extracting Triangle: This pattern is defined in Neo Wave – Advanced Elliott wave that takes the category of a triangle but does not necessarily look like an orthodox triangle pattern. This pattern as the name suggests extracts the power from the up leg (during upside correction) and the downside move gets stronger i.e. during an up move in form of Extracting triangle wave e < wave c < wave a whereas wave d > wave b.

Now look at below chart of Nifty which so far looks like an Extracting pattern. However, this is our assumption by looking at Time cycles that the pattern under formation will probably form an Extracting Triangle.

Nifty 60 mins chart:

The above chart with detailed explanation is published in the daily research report “The Financial Waves short term update” For detailed explanation and key levels subscribe to this report. Following is just an excerpt from the same:

Yesterday major buying was seen in Midcap and Smallcap stocks that continued to show outperformance over past few days. Banking stocks were among the top gainers before RBI policy meet today. It is expected that the key rates will be left unchanged. During an event closing price becomes important.

As shown on daily chart, 200 days average continue to move ………

As shown in 60 min chart, from the lows of 8321 prices bounced on upside and still running its course. Yesterday positive close was witnessed in this index but today’s close will be important after the policy announcement which will be probably kept unchanged. Momentum from here on will be crucial to watch as prices have now retraced the down move which started from the highs of 8654 to the lows of 8321 by almost 76.4 %. As per wave perspective, wave e of extracting triangle is still ongoing and the maximum allowable limit for this pattern is till ………….

In short, ……….move below 8410 will be first sign of exhaustion. Also we normally see a trending move about 30 mins after the policy announcement. Let us see if RBI acts as a reversal trigger like previous instances irrespective of rate cut or not or it results into a non event!

To know the key levels that will decide the reversal zone along with Elliott wave structure of stocks subscribe to “The Financial Waves short term update”. For subscription option visit the or call us on +91 9920422202/+91 22 28831358