Tuesday, April 21, 2015

Trading Nifty using indicators – Elliott wave, MACD, Time cycles, Channels! Catching reversals!

Nifty has given away more than 400 points in less than 4 days.
This might be a surprise to the short term traders or investors but using the objective techniques of Elliott wave, MACD, Channels on the short term charts can help you capture key reversal areas.

Many might argue and come out with fundamental justifications after the fall has happened. But is it possible to predict the movement before it even started? The answer is definitely YES with a given degree of probability!

We have published article few days back showing our prediction of 27th March that clearly showed the rally towards 8800 and then sharp fall from there. You can scroll few days back and check this article. Now below we are showing the short term techniques we used to time the market movement! Read below if you want to get more thrilled!!!

Nifty 60 mins chart: Anticipated on 16th April 2015 (published in morning research report)

Happened: closing of 20th April 2015

Wave Analysis:

The following was published on 16th April 2015 

Nifty had sharp reversal at 2:50 pm and lost nearly 100 points in nearly 10 minutes. We have been clearly warning about such moves which should not be a surprise to our subscribers. The major reason being that in the entire up move from 8270 levels there has been sharp reversals on downside and also the wave counts internally was suggesting that the rally is near completion. Also final leg wave c of second correction formed a wedge shaped  Ending diagonal pattern that warrants such sharp reversal.

We showed the path of Nifty on 27th March morning when prices closed near the days low of 8270 levels. It takes lot of belief in the objective techniques to mark the reversal on upside from there which clearly showed an up move till 8800 - 8830 levels which will complete wave (e) and then a move back on downside.Happened: Nifty has followed this path to the point along with time as well and reversed on the 49th day cycle.
Word of caution: If Nifty is indeed starting a major leg on downside we should see some serious selloff from here over next few weeks. In short, move below 8700 will confirm negative outlook on Nifty with resistance of 8830 on upside preferably on closing basis. Volatility can be high from here and existing short positions should now use 8830 as stoploss and follow trailing stop method in case this move develops into a bigger selloff from here!

The following was published on 17th April 2015 

Over short term, Nifty has taken out the important support of 8680  8700 as well on intraday basis. If this is indeed start of important trend then the top at 8800 should remain protected. So existing short positions should now trail stop towards 8800 and ride the trend as long as it lasts.

Short term MACD indicator shown on hourly chart has also move decisively below the signal line along with negative divergence with prices. Such minor negative divergences which are very important might be missed out on RSI as it is a bounded and range bound signal. It is therefore important to use one bounded like RSI and one non bounded indicator like MACD to gauge the internal strength and momentum. In short, trend for Nifty has reversed & one should avoid catching a low in this down move. The trend can be fast and sharp.

Happened: Nifty followed the path exactly as expected. It is only because of the belief in the objective techniques mentioned above that we are able to capture the entire down move so far. Since 27th March 2015 we have been able to capture nearly 500 points on upside on Nifty and now nearly 400 points down fall and counting.

What is next from here? You will have to subscribe for that to the daily equity research report The Financial Waves short term updateVisit Pricing page for subscription options and get insight into Nifty along with periodic update on Bank Nifty and three different stocks provide good short term trading opportunities. Trust me, this can be the best investment you have made so far!

Now post your charts with Technical Study and start the discussion on our Discussion Forum Page and get it answered by our experts. To post your chart now visithttp://www.wavesstrategy.com/Discussion/Discussions.aspx?type=start Call us on +91 9920422202/ +91 22 28831358 for any other details

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