Nifty has continued to move in the unchartered territory
with a positive breakout seen in today’s trading session. This will keep the
short term trend positive.
With markets moving in unchartered territory is it time to
stay complacent or cautious? Look at the below research published today morning
in our daily equity report “The
Financial Waves short term update”
Nifty daily chart:
Chart
courtesy: icharts
Following
is part of the research published today morning in our equity research report -
In previous update we
mentioned that, “Nifty
is intact in narrow range. Wait for decisive breakout. Move above 9370 will
result in to continuation of positive trend in form of wave g whereas break
below 9270 will be negative sign”
Nifty has
continued to do what it has been doing during the entire trend which started
from 7900 levels i.e. exhibiting trending move for 3 to 4 days and then moving
in a range for twice to thrice that time. It has been almost 8 days since Nifty
has been moving in a narrow range of 9270 and 9370 levels. Stock specific
movement has continued during this phase but as mentioned earlier not all
stocks are participating.
Advance decline ratio helps us to
gauge the overall momentum when the broader market index like Midcap and
Smallcap are hitting new life time highs. We can clearly see from the chart
shown above that Advance decline line has not improved at all and it has
continued to deteriorate with the rally. This is not a healthy sign from
medium term perspective and it indicates that only a few stocks are leading
the rally in high beta indices. Nevertheless, there is no negative price
confirmation as yet and so the trend will remain cautiously positive. …
As shown on daily chart, prices are exhibiting
series of negative divergence with respect to indicator – RSI. There is nearly 3 negative divergence
i.e. prices made new high but momentum indicator made lower highs. It is not
very often to see such series of negative divergences that to on a daily scale.
As per Advanced concepts of Elliott wave – Neo wave, faster retracement of the last wave
provides confirmation that the recent trend is over and the move on opposite
side has started. So faster retracement below ……… followed by complete retracement of wave …….. will confirm move on opposite side has started
but unless that happens one should play the range i.e. buying near supports and
………… Breakout
above 9370 will extend this rally further towards the Gann projection levels of
……………. shown in
current monthly research report.
As shown on
hourly chart, (shown in actual research report)
There is a possibility that wave g is forming a ……….. pattern and currently wave b is in formation in
the form of Diametric structure. This wave b has already consumed 8 days. So
for this to be a valid pattern we need to see positive breakout soon above
9370 levels.
In short, ………
Nifty has
been moving precisely as expected and the path given in the monthly research
report. The pattern has been playing out well but we are now going to take a cautious
stand given the series of negative divergences and deteriorating breadth.
There is no negative price confirmation yet and prices are headed towards our
mentioned target levels exactly as expected. “The Financial Waves short term update” will provide
detailed outlook on Nifty and what is the trend after it reaches the target
levels. Subscribe NOW using the Summer offer and see
yourself the urgency of knowing the important supports at this time. The
accuracy has been very high as the pattern is playing out precisely!
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