Monday, March 6, 2017

ICICI Bank: Neo wave Extracting Triangle Pattern and Topping Time cycles!

Identifying the Neo wave pattern and Time cycles to understand the trend of ICICI Bank.

Neo wave is the advanced Elliott wave concept has more than 15 rules which should be followed for impulsive waves. If one of the rules is not met then pattern is simply corrective in nature. Neo wave has introduced a few newer patterns which is not covered in Elliott wave such as Diametric pattern, Neutral Triangle pattern, Extracting Triangle pattern. These all patterns are corrective in nature and have different rules. Below we have shown daily chart of ICICI Bank which shows that second correction is forming Extracting Triangle pattern. Here we can see that downside legs are getting bigger whereas upside legs are smaller in nature. Apart from that there is 70 days Time cycle which is working as topping one from the start of 2016. Below we have shown part of research taken from The Financial Waves Short Term Update.   

ICICI Bank daily chart:

 Wave analysis:

As shown in daily chart of ICICI Bank, since 2016 this stock has continued to move in an upward moving channel. This time prices have failed to reach towards the channel resistance and have started to show weakness. Moreover this reversal has taken place when 70 days Time cycle was due in last week. This cycle has worked as important topping cycle in the past occasions and hence one should not ignore the same. In the current week prices have taken out low of prior weeks lows which will keep bias on negative side. MACD is also moving below signal line which indicates bearishness.

(The internal wave counts is shown on 60 mins chart which is shown in original report)

As shown in 60 mins chart, recently prices have broken the blue channel support and as of now hovering around the same. The fall was sharp in nature which increases the odd that minute wave (e) of minor wave e might have completed. Prices have also formed tilted Head and shoulder pattern which is a reversal pattern and forms during the stage of distribution. On upside ……. is the important resistance.

In short, ICICI Bank is now at important levels. Close below .followed by break of low of wave (d) near .will confirm the bearish outlook. Please note breaking of pivot support levels is important in the current market scenario.

To know in-depth research on Nifty and 3 stocks on daily basis subscribe to The Financial Waves Short Term Update

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