Wednesday, December 26, 2018

Will Nifty collapse like DJIA, Crude and Nifty?

Nifty had been moving precisely as expected and this time as well we are spot on in identifying the turn and cautioning near 11000 mark. The Global market selloff had been strong with DJIA (US) crashing, followed by Crude crashing, now spreading across to Nikkei 225 (Japan). This looks to be a repeat of 2008 where there was nowhere else to run for cover. Few months back when crypto currency were the darling among traders we warned that a crash in this asset class will be a warning sign that money has started moving out of riskier assets. This was clearly stated in our monthly research report. The entire global phenomenon has been playing out exactly like that and now the weakness has been spreading across. DJIA has shown one of the biggest losing streaks in years with heavy volumes when many are still trying to unearth the news revolving around the selloff. I wish markets worked on news or events making money would have been much easier. But freely traded markets follow patterns that are predictable in the form of Elliott wave and Time cycles. This has helped us to capture the swings each time precisely at the tops and lows. This time as well markets have continued to correct when we warned strongly near 10900 10970 mark.

In case you missed my webinar just before the crash on 21st December 2018 See it here

Now look at the below charts of Nifty published on 7th December 2018 in the daily equity research report

Nifty daily chart Anticipated on 7th December 2018

Happened: as on 24th December 2018
Anticipated on 7th December 2018 in “The Financial Waves Monthly update”

Nifty can move as per the path shown in figure 4. Prices are now in short term downtrend and break above the resistance of 10740 levels might result into retest of recent high near 10940 or higher in the zone of 11000. This is not necessary and it is best to look for shorting opportunity as we approach near the resistance levels. However, next few days of price action is very crucial. In case of sharp decline below …… the bigger degree correction will resume below ……….
One should be prepared for increase in volatility with state election outcome due over next few days as markets are already in corrective phase which is normally associated with high volatility. BANG ON!

Happened: Nifty moved precisely as expected and showed a pullback post 7th December. Despite BJP losing the state election and RBI governor resigning suddenly markets closed positive that day just to move as per the path shown in monthly report. Nifty touched intraday high of 10985 on 19th December 2018 and then reversed back sharply lower. Again precisely as per the path shown. So, think if events drive the prices then how can markets follow the path shown so precisely and accurately.

It is the Elliott wave patterns that help us to forecast the trend along with Time cycles. In our morning research report The Financial Waves short term update we cautioned exactly at 10900 10970 zone and break below 10880 followed by 10820 strongly confirmed the reversal. Nifty touched intraday low near 10534 in todays session which is already a move of around 300 to 350 points post the break of support. For building fresh shorts it is better to wait for pullback and existing shorts are riding the trend with well in the money trades.

We are in alignment with majority of indicators and Time cycles. It is not very often to get such high predictable trade setups. You can know the next big trend for Nifty in the daily and monthly research report.

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