Nifty has continued to move precisely as we have been expecting. Prices are working out the path so far to the point as per monthly research report. So, how to form trading strategy amidst the big event?
Now look at the below chart of Nifty along with Time cycles and Elliott wave pattern.
Nifty daily chart: (shown in daily research report – The Financial waves short term update)
Elliott wave analysis: (Following was published in morning report – The Financial waves short term update)
In previous update we mentioned that “The highest close so far in wave e is exactly equal to that of wave a near 10750 levels. So it is going to be interesting to see if the momentum can continue beyond the levels of 10750 – 10800”
The level of 10750 is still not taken out on closing basis which is the equality of current wave to that of wave a. This confirms the validity of the assumed Neutral triangle pattern so far. Next few days’ of price movement is going to be important as the Karnataka assembly election is going to result into increase in volatility. Many are assuming that markets will give positive breakout if BJP wins and will show sharp correction in case of any other outcome. However, this will be true only for few hours and markets will eventually start the trend it is supposed to do.
During previous Gujarat assembly election on 18th December 2017 a Time cycle low was supposed to be formed which we predicted more than a month prior to December. Nifty formed a low exactly on the same day and then reversed back sharply. For many this can be of no consequence but for us such strong breakdown followed by equally fast reversal simply shows power of Time cycles and this is not mere coincidence as we have seen this enough number of times now. The same cycles are entering into topping zone and next week it will be in 75% mode. So, irrespective of the outcome there can be ……….on the markets.
In short, we are looking at current movement as …….and next few day’s of price action will be important. On downside ……….. are short term support and resistance continues to be near ……… levels. Trading strategy mentioned of buying near the supports and selling near the resistance over past few days is working out extremely well!
Below are the trading strategy given over past few days and it has worked out brilliantly well on Nifty:
Trading Strategy given on 7th May morning – For today, long positions can be created on move above 10660 with 10620 as stop and target of 10700 levels, BANG ON!
Happened: Nifty has been moving precisely as expected and as per the trading strategy and moved above the target level
Trading Strategy given on 4th May morning – For today, short positions can be created on move below 10640 with 10680 as stop and target of 10600 or lower, BANG ON!
Happened: Nifty broke below 10640 levels and touched 10601 on downside
Trading Strategy given on 3rd May morning – short positions can be created on move below 10680 with 10720 as stop and target of 10640 or lower, BANG ON!
Happened: Nifty opened exactly at 10720 and selling pressure built up as soon as 10680 was broken and prices rushed towards the target levels!
The above clearly shows how one can capitalize on wave theory to form the trading strategy which we mentioned in our “The Financial waves trading update”
A major trend is about to start soon, it is time to be ready and prepared with the complete trading strategy. Get access to “The Financial Waves short term update” and see yourself why we think prices have arrived near crucial juncture and how to trade from here on on Nifty, Bank Nifty and stocks. Subscribe here
“The Financial waves monthly update” is also published that covers medium to long term views on Nifty, Midcap index, USDINR, MCX Gold which can be the next asset to look out for and bond yields. Get access to the monthly research here
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