Time cycles are important concept that we combine along with Elliott wave / Neo wave to get high conviction trade setups which help us to be against the crowd at major turning juncture.
Year 2015 has not been good for Indian Equity markets and especially for Banking stocks that have drastically underperformed. This year will be marked as the year of correction.
The fall on Nifty has been similar to that of the fall of 2011 which was mentioned in previous article along with detailed research given in previous week’s daily research report.
Bank Nifty daily chart with Time cycles:
The above daily chart of Bank Nifty shows that prices have been moving in downward correction since January 2015. This index topped out before Nifty and both indices continued to move lower. However, recently Nifty came very close to its low made on September 2015 near 7545 whereas Bank Nifty has continued to stay at much higher levels compared to its low made in September 2015. This indicates outperformance of Banking index which has been providing leading indications.
Time Cycles: have been working very accurately for past many years on Bank Nifty. This important cycle is now again due and given the outperformance of Banking index there is high likelihood we are close to the important lows.
Neo wave: Diametric pattern is one of the most important patterns described as per advanced Elliott wave concept – Neo wave and the entire correction since the high of January 2015 might have formed a Diametric pattern. For accurately timing it is prudent to look at the internal structure of this pattern along with key resistance levels that should be broken for strong positive confirmation.
As this is free article section we will not be able to indulge into detailed Elliott / Neowave counts and key levels that will confirm strong positive reversal.
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