Nifty Candlesticks, Elliott wave, Channels, Time cycles, RSI all predicted this down move..See yourself!

Selloff in Nifty even before Delhi Election exit polls.

Now the logical reasoning will be Delhi elections resulted into selloff in equity markets but the top was formed way before the voting day itself!

Following is the research published daily before equity markets opened in “The Financial Waves short term update” For subscription options visit Pricing Page.

See yourself the logical reasoning we had for markets to turn and the way it has been moving precisely as per the Elliott wave pattern that we forecasted!

Following is the chart shown on 27^th January 2015 in daily research report “The Financial Waves short term update”

Nifty 60 mins chart:

As per triangle rule prices can travel towards 100% to 125% of widest leg which gives an upside target zone of 8880 to maximum 9040.

Happened: Nifty made a top at 8996 very close to the average we have been expecting all the while on 30^th January 2015

Nifty 60 mins chart: - Anticipated on 2^nd February

Anticipated on 2^nd February 2015:

49 days Time cycle which has warned us that a turn is near and the up move is in matured stage. Many would compare this fall with that of 6^th January but the major difference being that this fall has happened from the channel resistance after strong euphoria near the Time cycle top with VIX index reaching near 20 levels from lows of 13 along with prior up move.

In short, break of 8795 has turned the bias negative on Indian markets. Follow-up action of 2 days will be very crucial from here. Failure to show any meaningful bounce with sustained pressure below Friday’s low at 8775 followed by 8690 will indicate a very important top is in place atleast for next few months. It is time to stay away from the crowd and follow the objective techniques rather than getting carried away with unrealistic targets.

Happened: We have been constantly warning our subscribers to stay alert and not get carried away in the euphoria. The Elliott wave pattern has worked precisely to the point so far!

Nifty 60 mins chart: Anticipated today morning before equity markets opened

Happened:

Wave Analysis: In today’s morning research report we mentioned the following:

Anticipated in today’s morning research report: In previous update we mentioned that “In short, trend for Nifty continues to be negative unless we see a close above prior bar’s high. Intraday volatility can now subside and a strong trending move is due to emerge. Decisive break below Bollinger band will provide strong negative confirmation.”

Nifty continued to form red bar throughout the week and closed at not only the day’s low but also week’s low. Infact, on the weekly basis we can see a very strong bearish Evening candlestick pattern. This is three candles pattern and usually indicates short term reversal especially when it occurs from the important Fibonacci and Channel resistance area….

Now, Delhi Election exit polls are suggesting a clear victory by AAP party. This will become clearer tomorrow on the counting day but markets are going to discount it today in anticipation. This does not directly impact the ruling government BJP but the rally has been more driven by positive euphoria rather than rationality. Also the Banking stocks have already started taking a beating after a few banks reported poor than expected results both in Private sector and PSU space. Case in point is if the two major factors responsible for driving markets toward 9000 mark are changing then there has to be some impact and change in sentiments atleast over short term.

Nifty hourly chart clearly shows…..(explained in actual report) In short, we continue to think that prices are now in wave …or wave ….. and trend will remain negative unless we see a close above 8760. Sharp move towards 8450 can be expected if this is indeed wave ……. on downside which will also confirm a bigger degree top atleast for few months is formed!

Happened: Nifty moved sharply lower and already touched the lows of 8516 coming close to the first target level of 8450

Subscribe NOW to this daily research report and trust me it is worth the investment that one can make at no risk. Trade objectively using these techniques by simply following it in “The Financial Waves short term update”daily research report. Visit www.wavesstrategy.com for subscription options.

AAP: A revolution in Indian politics after 6 years correction in stock market

By Waves Strategy Advisors, For daily research updates visit www.wavesstrategy.com

Wishing you all a very Happy and revolution New Year 2014. A change in outlook of Indian politics in 2014 should be the theme of the year!!!

Aam Aadmi Party (AAP) is a revolution in Indian politics creating a mass movement in country. The aim and mission of anti-corruption - a much needed change is spreading like fire across India.Mr. Arvind Kejriwal by becoming a Delhi CM from a party created just a year back simply reflects drastic change in social mood of people since the pervious election held in 2009.

Linking politics to stock market: In 2009 after the clear majority by Congress the already ruling government in form of UPA led to circuit up close on both Nifty and Sensex. Such extreme euphoric rise was based on the expectation of drastic pickup in growth and economy. But all that came was breakout of scams rather than trend.

We have recently witnessed top notch people from Indian corporate has started believing that a change is much needed for this country so that it can become a 3^rd largest economy after few decades which many are claiming. But this shift in social mood has come after a sustained period of correction seen in stock market even though it was in the form of sideways action that ensued since 2008 onwards.

The below chart is of Sensex since 2008 onwards:

The above chart of Sensex since 2008 onwards is showing a very clear sideways correction ongoing. We still believe the movement of 2009 was a part of the correction and not the new trend. We have not marked all the scandals since 2009 onwards but to name a few major ones are the CWG of 2010, 2G scam, IPL scandal, Coalgate scam. I might miss out a few major ones as the list is ongoing. But during the period of unprecedented growth from 2003 to 2008 there were news everywhere about India shining and Indian growth, India domestic consumption,decoupling, etc. Undoubtedly the market dynamics and trend was different then as compared against 2008 onwards.

Sideways action is still a correction as it is the period of decelerated growth. During such times demand reduces, situation becomes challenging, money velocity reduces thereby putting burden on financing the projects. This leads to a period of uncovering of scandals when social mood is extremely negative. During such stressful times people tend to find out logical reasons and select the extremists’ party as they crave for change.

Case in point: is that the change we are seeing in Indian politics and crème de la crème from Indian corporate like V Balakrishnan, Adarsh Shastri by joining AAP is simply reflecting a step ahead in this mass revolution. This has happened only after a sustained period of slow or no growth since 2008 onwards. A 6 years of stock market correction is a mirror of this revolution and with the start of next bull trend scandals / scams will again take a back seat and the focus will shift back towards growth and domestic consumption. Memory of people is always affixed on Currency affairs and not on history as it is short lived & this period of agitation, stress will be a passé post 2014!

Subscribe to "The Financial Monthly Update" or "The Financial Waves Short Term Update" to know the trend ahead in Equity markets

To Subscribe visit http://wavesstrategy.com/index.php/store.html or Contact us