Nifty: Are we heading for a collapse? Technical indicators getting aligned together!

Nifty and Bank Nifty has shown Gap down opening despite all the euphoria and prevailing optimism across the board. But is it just the start of bigger trend on downside?

Below are a few technical studies that are not sending across very promising sign.  These advanced methods like Elliott wave, Neo wave, Time cycles are all pointing towards one direction which is down and now close below important support levels will provide the much needed price confirmation as well.

We have been constantly mentioning to our clients not to buy the euphoria as the probability of going higher looked bleak. Today’s movement simply reflects power of technical studies. But it is just few hours of move and expiry closing is very crucial. We will come out strong and bold probably against the majority as soon as prices break below important support levels from medium term perspective. Keep tracking “The Financial Waves short term update” for key indicators and levels.

Nifty daily chart: (shown in today’s morning report)

(a portion of the chart is purposely omitted as complete chart is shown in morning report for clients)

Nifty had a positive opening but prices after moving in a narrow range finally gave away and closed near day’s low. Stocks like SBI, LT, ICICI Bank looks like forming a classical distribution pattern and break below support levels can result into sharp decline. It is important to see the closing today on expiry but chances of upward movement is getting bleak as cycles are in sell mode.

As shown on daily chart, we continue to look at ….. days cycle in the topping formation. During the previous wave d fall the cycle started putting pressure during the last few days and it seems the similar action is going to be seen this time as well. We have now completed 41 days and prices are simply failing to move higher despite of all the euphoria which is a sign of caution. Many analyst and traders are super bullish even now and if there is sharp reversal on downside majority will be again caught in surprise. Also this time there will not be deeper upside pullback as the positions will be stuck at higher levels.

It is time to look at the internals very closely. As shown on hourly chart (shown in morning research report), prices are moving exactly as we have been expecting. It is simply consuming time in wave (….) of e which can be complete anytime now. Break below lower Bollinger bands followed by break of …… will be first sign of weakness. This followed by move below ……. will provide two stage negative confirmation. We will revisit this once the first set of supports is broken. 

In short, …………..

The above analysis shows various advanced methods that we use in order to forecast the turning areas despite of all the news or ongoing euphoria. It takes strong belief in the studies that has stood test of time be against the crowd… We have been able to capture major tops earlier as well. Let us see if this time as well the probability favours us else it will only be delayed by few more days!

Get access to “The Financial Waves short term update” our flagship research report that covers detailed analysis on Nifty, Bank Nifty, stocks using Time cycles, Elliott – Neo wave and other important indicators like RSI, Moving averages. We might just get an excellent trading opportunity once important support levels are broken on closing basis. It is not very often to see such alignment of indicators. You cannot miss this opportunity, See it yourself – Subscribe NOW!