Nifty has continued to move in a predictable fashion.
It is now moving in a range after forming a low near 7710. Momentum is yet to pick up in either direction. Even during such scenario intraday strategy is providing good trading opportunities.
Below is the chart of Nifty showing range bound action:
Nifty 60 mins chart: (Below chart is picked up from daily research report)
Wave analysis: (Following was published today morning before equity markets opened)
In previous update we mentioned that, “In short, expect range bound movement to continue and wait for clear breakout from the mentioned levels for strong trending move to emerge.”
Nifty continued to move in a range as expected. Prices managed to take out the first resistance level at 7870 but failed to sustain above it and closed near 7850. Also we know from past that wave (x) usually acts as an important resistance. The down move from the highs of 8340 is non impulsive in form of triple correction and currently the third standard correction is still ongoing in the form of sideways action. Unless we see a strong break above the wave (x) level which is near ……. such sideways action can continue.
There is huge open interest buildup in the Call option at the strike of 8000. This indicates that crossing above this level is going to be difficult in this expiry and on downside 7700 strike put has maximum open interest indicating this as an important support area. This is altogether a different method to identify the key levels. Please note these levels are in close sync with the levels derived using Elliott wave pattern. We have been mentioning 7940 on upside and 7700 on downside as important as per the pattern analysis.
In addition to above we also show the daily chart with detailed Elliott wave counts along with below trading strategy mentioned in “The Financial Waves trading update”
Published on 20th November 2015 before markets opened: Long positions can be created if Nifty move towards 7820 then bounces back above 7860 with day's low as stop and target of 7900." BANG ON!
Happened: Nifty moved exactly as expected on Friday’s session.. We cannot be more accurate on the levels. Nifty made intraday low near 7818 and then high near 7906. It moved exactly as expected and achieved the target level.
Published on 18th November 2015 morning before markets opened: "Short positions can be created on move below 7790 with day's high as stop and target of 7740." BANG ON!
Happened: On 18th November, Nifty moved lower exactly as expected and touched intraday low of 7725
Published on 17th November 2015 morning: Nifty can trade in sideways action over next few days. For today, short positions can be created if Nifty move towards 7830 and then moves back below 7780 with day's high as stop and target of 7740. Long positions can be created if Nifty move towards 7790 then bounces back above 7840 with day's low as stop and target of 7890.
Happened on 17th November trading session: We mentioned 7780 - 7790 as important support area. Nifty made a low near 7793 and reversed back from there. Also it has been moving in sideways pattern since then. For a derivative trader knowing that prices are going to trade in sideways action is also vital information.
The above strategies are mentioned in our daily research report “The Financial Waves Trading update”that covers in-depth analysis on Nifty using Elliott wave and trading strategy. In case you would like to know the trend for stocks as well subscribe now to “The Financial Waves short term update” that covers Nifty and stocks outlook.