Post Budget what is the outlook on Bank Nifty?

Budget 2016: One of the important events which is Budget of 2016 is now OVER.

The market reaction to the same till now has been volatile as expected. Nifty showed sharp down move towards 6825 and then recovery towards 7090 level. This has been keeping Nifty in a big range. Spikes created on event can act as important support or resistance. So this week is going to be crucial. Bank Nifty has managed to recover from the lows and now trading near 14000 level. From technical perspective, this index has been trading at crucial juncture. Same as Nifty, Bank Nifty has also arrived at the channel support. So what is next from here on?

Below we have shown part of research taken from “The Financial Waves Short Term Update” taken from the report dated 15^th February 2016.

Bank Nifty daily chart: (published on 15^th Feb 2016)

Wave analysis: (as published on 15^th February 2016)

Bank Nifty has been at all over the places in past two weeks and this index has been one of the major culprits for dragging index lower. It becomes crucial to observe the medium term trend and levels to see if a reversal is possible or we are going to move sharply lower.

We are showing daily chart above that indicates that after the rise from the low of 2014 this index topped out in January 2015 ahead of Nifty. Please note the rise we are marking as corrective to make it in sync withAdvanced Elliott wave method and wave counts shown in our monthly outlook.

The entire down move has now corrected the rise by near 61.8% level in previous week and the index is now very close to breaking its lower trendline support. If we do not see a move back above this trendline than a real panic situation might arise that can result into a free fall. So this week is very crucial and prices have to move back above 14200.

As mentioned earlier it is not very often to see break of downward channel on downside but we will let prices decide where it really wants to head over medium term. We are indeed at very important juncture and the final line in the sand will be ……. levels. A decisive break below this can lead to a free fall with no supports in near vicinity.

Prices are now in wave a of second corrective and there is no indication if it is complete. Move above 14500 will provide the much needed relief and indicate wave b is ongoing, post which final wave c might be more of a consolidation pattern in form of Ending diagonal. But these are all assumptions as of now and price action is most important.

In a nutshell, Bank Nifty is now standing at 61.8% retracement level along with channel. Move below ……will result into a carnage whereas move back above ……. will confirm existing wave structure. Stay alert as this week is going to provide very important signals from medium to long term perspective!

Post publishing the research prices have managed to trade in range and have protected the crucial levels on closing basis till now. So what is next from here on?  

Subscribe to “The Financial Waves Short Term Update” which covers in-depth research on Indian Equity Markets along with 3 stocks on daily basis. This report also includes Bank Nifty twice or thrice in a month. For subscription visit Pricing Page

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Budget Expectations – Will Nifty manage to protect the multi-month channel support?

Indian equity markets topped out in month of March 2015 and crossed below the level of 7000 which no one thought is possible. A strong trend does not look at fundamentals like lower Crude prices or positive macro economic factors. It is only when the trend is due to change it will reverse. External events can only result into short term movement but eventually the major trend resumes.

Now look at the below chart of Nifty which shows prices have continued to move in downward sloping channel irrespective of the events, results or any other factors. This is one of the most basic methods of technical analysis that provides insight into the trend of the market along with crucial support or resistance.

Nifty daily chart:

The above chart shows the trend ongoing since March 2015.

Budgetary Expectations: Now many would be expecting a strong positive budget for reviving the stressed economy. Anything below expectation can result into serious capitulation. However, we believe that it will be perception towards the Budget outcome that will result into the movement. A good Budget will be perceived negatively if the sentiments are strong bearish and will result into break of previous low near 6870 levels. This level is going to be very crucial given the fact that it is very close to the lower trendline channel support.

On the other hand, a move back above crucial resistance level will result into a much needed relief rally. News will adopt and change based on the movement of markets and not the other way around. A positive move on Nifty back above 7255 will result into the focus on positive Budgetary outcome whereas break of 6870 will result into a strong negative news and how Budget fell short of expectations.

In a nutshell, it will be the movement of market that will define the news and Budgetary expectations. It is rare to see break below the downward sloping trendline on downside.

Let us see if the Budget is simply coinciding with the reversal due from the lower trendline support or the sentiments continue to be strongly bearish taking Nifty below 6870 which will be a real warning sign for medium to long term trend!

“The Financial Waves short term update” is a daily research report that shows Elliott wave counts along with other advanced technical concepts on Nifty and covers three different stocks. For subscription options visit Pricing Page.

Training on Time Cycles and Neo Wave - Advanced Elliott Wave for Portfolio Creation, Stock Selection & Trading

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Get ready for the markets in 2016. We strongly believe that the downtrend that started in 2015 is in matured stage and we are now getting ready for a very strong reversal and uptrend. For now there is no positive confirmation but the technique of Time cycle along with two stage confirmation as per Neo wave techniques which is Advanced part of Elliott wave is providing leading signals.

We have been able to capture the top in 2015 very accurately and are optimistic to rely again on these objective and scientific methods rather even if it is against the crowd to take correct and independent decision. You can also learn these techniques and start building on the experience of capturing the major turning areas.

Join us for the 2 days extensive course on Time cycles and Neo wave techniques for Portfolio building, stock selection and ideal trade setups

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·  Ideal Trade setups to enter the market

·  Time cycles – A very important element to help reduce the number of probable scenarios to nearly one!

· How to make the most of the position by timing the exit

· Know when not to trade – A key to trading success

· Applying other techniques along with Elliott wave for high conviction trade setups

· How to keep the profits intact after a winning streak…

· Participate on our Discussion Forum to keep learning the technique even after the course.

· Post your charts after the course with the Elliott / Neo wave counts, Time cycles or any other techniques you like to apply and get instant feedback 

·Access to Free research for a limited period

When and where is the Course?

The training is at Hotel Grand Sarovar Premiere, Goregoan, Mumbai on 12^th -13^th March 2016. This belongs to 5 star category having chain of international hotels and the fees are including Tea / Coffee and Lunch.

Contents:

1. Overview of Elliott Wave

2. Neo Wave

3. Two stage confirmations

4. Diametric Pattern

5. Newly discovered patterns

6. Different Rules and guidelines

7. Cycle Analysis: Time the market with accuracy using Time cycles

8. Trade setups, Application of the concepts on charts

Who is the speaker?

Ashish Kyal, B.E., MBA, CMT

Ashish carries vast experience of analyzing World Equity, Currency and Commodity markets using techniques like Elliott Waves, Time Cycles, and momentum tools.

Ashish is a regular speaker on CNBC TV 18, Zee Business and Dukascopy- Swiss Business Channel. He frequently speaks at financial seminars like Market Technicians Association (MTA - USA), Association of Technical Market Analysts (ATMA), National Institute of Bank Management (NIBM), Sydenham Management college. He is on the selection panel of GDPI for premiere B- Schools and invited by Somaiya Institute of Management Studies and Research to speak on Entrepreneurship. He has also been invited as a guest speaker at National Stock Exchange of India (NSE) for the Post Graduate Certificate Program in Financial Economics, had been a chairperson for SIMSR International Finance conference.

Training Duration:

12 hours (6 hours daily)

Registration Fee:

Early Bird offer: Investment for the Training is Rs. 23000 + 14.5 % Service tax. If registered after 1st Feb 2016 charges would be Rs. 26000 +14.5 % Service tax

Registration is on first come first basis as there are limited seats.

For registration visit http://www.wavesstrategy.com/Payment.aspx or call us on +91 22 28831358 / +91 9920422202 or write to us at helpdesk@wavesstrategy.com

Testimonials

The simplification of complex subject of "Elliott Waves" and combination of Elliot Waves with Classical Technical Tools are not only Awesome, but Unique too. I've thoroughly enjoyed Mr. Kyal's Seminar at Sarovar Premier Hotel, Bombay during 13th & 14th October, 2013 because of his Flawless, Plain (Jargon free) and Lucid Language. Best of all I liked his virtue to teach what he really performs in his real professional life. And last, but not least, Mr. Kyal's Seminar was the Best of All Seminars I've ever attended.

-Kiran Banjara, KB Investment Avenues,Ahmadabad-GJ

Mr. Ashish Kyal is simply the most amazing teacher of practical Elliott Wave Theory.

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First of all big thank you for the excellent training session. This was one of the best training I've ever been in!!!You did terribly well! I was/and still am impressed about how you made something "simple" from this very complicated stuff called NEOWAVE -I tried to read the book, and gave up...Now I'll give it another try…

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Nifty: “TRIN” indicator at extreme levels! Applied with Hourly Elliott wave counts

What is the 'Arms Index - TRIN'?

A technical analysis indicator that compares advancing and declining stock issues and trading volume as an indicator of overall market sentiment. 

The Arms index is calculated as follows:

TRIN = (advancing issues/declining issues)

               (volume of advancing issues/

                 volume of declining issues)

TRIN indicator is the ratio of advance/ decline with advancing and declining volume. We have been using this indicator to understand overbought and oversold level. The chart of TRIN suggests that the zone of 1.2-1.3 is the extreme oversold level. 

We can see that in the mid of June as well as in the start of September 2015 reversal was witnessed from this zone. Hence, this indicates that lot of volume has already gone on the downside and Nifty is now trading in oversold territory. One should use this kind of indicators as a warning signal but it will be only on break of resistance on upside we will get positive confirmation.

Nifty 60 mins chart:

The above chart shows the internal Elliott wave counts of Nifty along with crucial levels (shown in actual report). Nifty had a Gap up opening in today’s session and is so far sustaining above the same. It will be important to see if the crucial resistance is now taken out for short term positivity to continue.

Such oversold readings on indicator can result into sharp reversals and we have seen that over past few days when majority was expecting capitulation to continue, markets has been surprising them by Gap up moves.

It therefore becomes important to apply different techniques like Channels, Pivot support resistance zone, Elliott wave, indicators like TRIN, RSI, etc Time concept of Neo wave to understand the maturity of trend.

“The Financial Waves short term update” is a daily research publication that covers Nifty and three different stocks on rotational basis showing applied Elliott wave, Time cycles, indicators and many other concepts. Subscribe now online by visiting Pricing Page.

Announcement:

Join US for the 2 days training workshop to be held on 12^th & 13^th March 2015 in Mumbai on the most advanced concepts of Technical analysis - Neo wave (Advanced Elliott wave) combined together with J.M.Hurst Time cycles – a powerful tool to forecasts Elliott wave patterns using Time cycles – A complete different way to look at market behavior, forecasting and trading!!!To register for the training using either Credit Card or Netbanking visit http://www.wavesstrategy.com/Payment.aspxand mention Product as “Neo waveTraining” and period as “1”

Nifty: is important low in place? Understanding the medium to long term trend!!

Nifty continued to move lower and created panic environment by closing below 7000 mark. Trend remains negative unless we see reversal signs. Avoid catching a low!

Nifty Weekly chart:

Nifty daily chart:

Nifty 60 mins chart:

Wave analysis:

Each point of Nifty has been on the blue channel since the start of correction in 2008. This confirms the basic assumption that the entire rise post that year has been corrective fashion. As per advanced Elliott wave – Neo wave concept, a perfectly channelized move is not a characteristic of an impulse pattern. This means that the correction that started in 2008 is still ongoing and we are in final leg of wave [E] of triangle pattern. On a logarithmic scale the pattern is clearer and one can see a running triangle. However, trendlines are more important on arithmetic scales.

In the recent downtrend we can see break below the red trendline as shown on the weekly chart. It is rare to see a downward sloping trendline gets broken itself on downside and happens once in many years. This situation arises during a panic scenario and the last week movement is a perfect example of that.  Nevertheless, 6750 – 6800 level is the final line in the sand and a movement further below this will force us to adopt much bearish scenario as it will be close to be breaking the lower blue trendline support as well. It is not often to see such type of movement unless the bear trend is going to extend by few more years. In, Indian context we have not seen a downtrend lasting for more than 14 to 15 months. Even the fall in 2008 started from January 2008 and made panic low in October 2008 lasting only 8 months from top to bottom. The correction started in November 2010 ended in December 2011 lasting 14 months. The recent correction is now 12 months old already.

As shown on 60 mins chart, prices are moving lower in double corrective pattern from the level of 7600. The first correction was a Flat correction. A Flat correction has to be followed by either a Flat or a triangle as the intensity has to reduce if our pattern reading is correct. This means that if wave a of second correction is in place than wave b should bounce back atleast towards 7060 to 7110 zone. Failure to do that and a break back below 6850 will be strongly bearish.

This week movement is going to be very important and we are keeping a close eye on each wave movement. Many of the monthly cycles were also due in last week and if prices do not respect time then we are indeed into very big bear trend. As of now we continue to believe that what has worked in the past is going to work unless it is proven wrong. Let us see if there is indeed a push above 7060 followed by 7110 in this week and the low remains protected which will then be termed as a panic low. However, post completion of wave b on upside there will be wave c which will come close to the retest of the recent lows. A faster retracement above 7250 will indicate that a very important low is in place and surprises will be on upside.

In short, this week’s movement is crucial. Break below Friday’s low followed by 6800 will be strongly bearish but we can expect some pullback or consolidation in this week. On upside crossing above 7060 – 7110 is important to reduce the downside pressure. Faster retracement above 7250 will be first indication that a major low might be in place.

To access the complete report of research on Nifty plus Bank Nifty, Axis Bank and Ashok Leyland sign up in Free Member Login

Subscribe to “The Financial Waves Short Term Update” which covers Nifty and 3 stocks with important levels and Elliott wave counts. For more information visit Pricing Page

Is Nifty forming a major base before strong trend? Shift in Sentiments…

Shift in Sentiments: Nifty continued to be under pressure in month of January 2016. Many street experts cited that start of 2016 has been one of the worst starts for Global markets as well. However, it has only resulted into wild gyrations within a range for majority of markets. On Nifty the low of December 2015 had been near 7551 and the high of Feb so far is near 7600. Interesting, isn’t it! Simply imagine Nifty had momentarily moved above the level seen in December 2015 but the amount of pessimism and fear January has created so far. Even a person having no know-how of how stock market works has been coming out with projections of sub – 6800 levels. I am amused at times to understand the consensus level and trust me if you ask any random person he will give you a figure between 6800 – 6900 zone as Nifty target! With all due respect, we can never be certain about future but the probability of prices reaching towards that zone is reducing with time! The projections were exactly the opposite during the period of early 2015 when consensus was Nifty for 9500++ levels. This simply reflects herding behavior that are prominent characteristics seen not only in animals but humans as well.

Figure 1: Nifty weekly chart (shown with all wave counts in Monthly research report)

Nifty underperformance near extreme level compared to Bank Nifty: The indicator below the Nifty price shows relative comparison of Nifty and Bank Nifty. A downward moving ratio indicates Nifty is relatively underperforming whereas an upward moving ratio will indicate that Nifty will outperform Bank Nifty. The ratio has been maintained at the lowest levels seen since 2008. There is high possibility that the ratio will mean revert and reach towards 0.60 levels again. This indicates that Bank Nifty is going to underperform Nifty for many months to come and this make sense as after such a sharp fall in PSU Banks we should see some consolidation or sideways action before a strong rally in that sector. In a nutshell, Bank Nifty might not give best of the returns that majority including most of the Mutual Funds are expecting but it will be other sectors that will lead the rally this time. 

……………..

Majority of the indicators right from Extreme pessimism – Sentiment indicator, 40 months Time cycle, Monthly Bollinger Band, Ratio chart, Neo wave long term counts along with 54 days Time cycle, Neo wave short term pattern, Channels are all aligned together. The higher probability scenario suggests that a ……….. should be formed in ……………..week of February and we should see some strong ………... However, confirmation of the same will be obtained only on faster retracement …….We are keeping a close tab on the short term charts to get confirmation from prices. February will be a month of surprise. Time will tell!

The above article is picked up from “The Financial waves Monthly update” that covers detailed analysis on medium to long term forecasts of Nifty, Stock picks, Global markets, Commodity, Currency and much more with applied most advanced concepts of Technical analysis like Neo wave , Time cycles, Fibonacci ratios, etc. Subscribe NOW by simply visiting the PricingPage.

Announcement:

Join US for the 2 days training workshop to be held on 14^th & 15^th March 2015 in Mumbai on the most advanced concepts of Technical analysis - Neo wave (Advanced Elliott wave) combined together with J.M.Hurst Time cycles – a powerful tool to forecasts Elliott wave patterns using Time cycles – A complete different way to look at market behavior, forecasting and trading!!!

Limited seats available! Enroll NOW

Where and when is the course?

The training is at Hotel Grand Sarovar Premiere, Goregaon, Mumbai on 12^th & 13^th March 2016. This belongs to 5 star category having chain of international hotels and the fees are including Tea / Coffee and Lunch.

How to Enroll?

To register for the training using either Credit Card or Netbanking visit http://www.wavesstrategy.com/Payment.aspx and mention Product as “Neo waveTraining” and period as “1”

What is Hurst’s Time cycle and understanding its power when combined with Neo wave?

J.M.Hurst suggested that there are certain standard cycles which are universal and can be applied on any asset classes.

Many cycle analysts often complain that cycles vanish without giving prior indication. The major reason being interaction of different cycles of varying magnitude.

The subject might look complicated but it is no different than Elliott wave principle. The major difference is Hurst Cycle analysis helps us to predict time and Elliott wave focuses more on price. This element of time can help us to forecast the Elliott wave pattern that can form in future. If you understand the logic at one level of degree, identifying and analyzing the cycles at higher or lower degree becomes more mechanical and easy.

As shown in below chart we have applied Time cycle on Bank Nifty Daily chart along with Neo Wave. The important part of Hurst Cycle is that if you know that major as well as smaller degree cycles are citing towards probable bottom or top then you can save yourself from making wrong trade. In market “when not to trade is the key to success”.

Bank Nifty daily chart:

With the help of this Hurst cycle along with Advanced Elliott wave (Neo Wave) we expect that the down move is in its matured stage. The fall that started from 21000  in the month of February 2015 in Bank Nifty is probably making Diametric pattern. This pattern consists of 7 legs (a-b-c-d-e-f-g). We are expecting this down move to complete soon and the Hurst’s Time cycle is also confirming the same.

We would differ with majority who are turning extremely pessimistic exactly at the wrong time.

The above chart clearly shows Fibonacci ratios, Neo wave pattern and Hurst’s Time cycles all of the techniques are pointing towards the similar outcome that the downtrend is in matured stages.

Join US for the 2 days training workshop to be held on 14^th & 15^th March 2015 in Mumbai on the most advanced concepts of Technical analysis - Neo wave (Advanced Elliott wave) combined together with J.M.Hurst Time cycles – a powerful tool to forecasts Elliott wave patterns using Time cycles – A complete different way to look at market behavior, forecasting and trading!!!

Book your seat now!

Where and when is the course?

The training is at Hotel Grand Sarovar Premiere, Goregaon, Mumbai on 12^th & 13^th March 2016. This belongs to 5 star category having chain of international hotels and the fees are including Tea / Coffee and Lunch.

Registration Fee:

The charges for the Training are Rs. 26000 + 14.5% Service tax.  Registration is on first come first basis as there are limited seats. This includes 1 week of FREE Elliott wave video before the training session itself along with 12 months of FREE Monthly Research reports that is worth 12,000 /-

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Nifty Neo wave pattern along with Time cycles - path ahead!

Neo wave is advanced concept of Elliott wave that has more number of rules compared to orthodox wave theory. These advanced rules help us to reduce the number of probable scenario and provides immense objectivity. We took a step forward and combined this wave theory along with Time cycles to forecasts the trend and probable path ahead!

As per this concept there high probability that the ongoing downtrend that started in March 2015 is in matured stages of down move and we should start seeing a very strong trend – this time on upside.

However, there is no positive price confirmation as yet and it is prudent to combine predictive method with bar technique and other tools for timing the trade.

Both Neo wave and Time cycles have helped us to stay on opposite side of the trend near the lows of 7240 when majority were bearish and we constantly warned about near term bottom.

Now look at the below chart marked with respect to NEO wave and Time cycles

The above chart shows the entire fall from the top of April 2015 in the form of a Diametric pattern that consists of 7 corrective legs (marked in red). Prices are currently in wave g (red). This intermediate wave g (red) is itself forming a Diametric pattern marked in above chart. We are in final leg (g) of g (red) which should complete soon and the trend should reverse.

Hurst’s Time cycle shown above also help us to get confirmation about the pattern under formation. This cycle is due in a few days and in synchronized with the Neo wave pattern.

We will highlight in our daily research report as and when we get strong positive confirmation that the trend on upside is starting. Subscribe to “The Financial Waves short term update” to know the crucial levels that will determine strong reversal in trend. For subscription options visit Pricing Page.

Two days Training workshop on Neo wave and Hurst’s Time cycles

Attend one of the most advanced training on technical analysis which focuses on Hurst’s Time cycles along with Neo wave – Advanced Elliott wave to understand the key reversal areas that can be applied right from trading to creating investment portfolios.

Enroll now for the training to be conducted on 12^th and 13^th March 2016 before 1^st February to avail early bird offer. It is a very different experience when you are trained to capture the reversal areas yourself but yes this will come with experience and practice. Post the training you can also share across the charts as an ongoing support. For registering Contact US or write to us at helpdesk@wavesstrategy.com or call us on +91 9920422202 / +91 22 28831358.