Weekly technical Analysis for week ended 27th August 2011.
Ho Ho Ho how many times Elliott wave tells where the market is headed in case of uncertainties. This time also it was indicating from last five to six months that we are in for a bad market and you can see now where you are headed. I have been indicating from last so many months that we are in for a very very bad market as the pattern formation as per the Elliott wave was painting a bearish picture. I was giving a minimum target of around 4700 levels from last five to six months and you see what we have achieved we are virtually near the target. Mind you it is the minimum target and the maximums would be more bearish. All along the last six months many of you might be thinking that i am a bear and that why I am giving those bearish targets. But ultimately price speaks. All around the news channels or media everybody was telling that first we might not go below 5200 and then in any case it would not go below 5000 and you see the final result. That’s where the Elliott wave helps it gives a clear picture when there choes in the market and this time also it did not disappoint me or anybody. Then why I have stuck to the pattern, even though sometimes market was trying to indicate otherwise, because the reversal patterns or the negation of the pattern was not indicated. As per elliotte till its proven otherwise we should stick to the original pattern, with amendments along as the price move and if the pattern changes then just change accordingly and don’t argue. And this time also it did not deceive me.
The movement of nifty during the week is indicating an extremely weakness for the market. This week market has done one of the very bearish patterns. It has moved and close below 200 week EMA on weekly charts, which is a very bearish indication. In the last two decades market has moved below 200 week EMA only three times earlier and this time its fourth time it has done. And in the earlier three times it whenever it has moved below 200 week EMA market has fell by at least 20% from those levels and we have to see whether it would be different this time. If you go by the history then we have to fall by 20% from these levels. Means nearly 1000 points from these levels it frightening if you consider at this point of time but target might be achieved. One positive point for short time, except in 2008, in earlier two occasion nifty has immediately bounced back and then it has collapsed. Whether this would happen this time also. In the coming week, we have to see market recovering and closing above the 200 week EMA otherwise the next month would be disastrous for the market and it has all chances of collapsing from current levels. So at-least this time hope for the best.
Ho Ho Ho how many times Elliott wave tells where the market is headed in case of uncertainties. This time also it was indicating from last five to six months that we are in for a bad market and you can see now where you are headed. I have been indicating from last so many months that we are in for a very very bad market as the pattern formation as per the Elliott wave was painting a bearish picture. I was giving a minimum target of around 4700 levels from last five to six months and you see what we have achieved we are virtually near the target. Mind you it is the minimum target and the maximums would be more bearish. All along the last six months many of you might be thinking that i am a bear and that why I am giving those bearish targets. But ultimately price speaks. All around the news channels or media everybody was telling that first we might not go below 5200 and then in any case it would not go below 5000 and you see the final result. That’s where the Elliott wave helps it gives a clear picture when there choes in the market and this time also it did not disappoint me or anybody. Then why I have stuck to the pattern, even though sometimes market was trying to indicate otherwise, because the reversal patterns or the negation of the pattern was not indicated. As per elliotte till its proven otherwise we should stick to the original pattern, with amendments along as the price move and if the pattern changes then just change accordingly and don’t argue. And this time also it did not deceive me.
The movement of nifty during the week is indicating an extremely weakness for the market. This week market has done one of the very bearish patterns. It has moved and close below 200 week EMA on weekly charts, which is a very bearish indication. In the last two decades market has moved below 200 week EMA only three times earlier and this time its fourth time it has done. And in the earlier three times it whenever it has moved below 200 week EMA market has fell by at least 20% from those levels and we have to see whether it would be different this time. If you go by the history then we have to fall by 20% from these levels. Means nearly 1000 points from these levels it frightening if you consider at this point of time but target might be achieved. One positive point for short time, except in 2008, in earlier two occasion nifty has immediately bounced back and then it has collapsed. Whether this would happen this time also. In the coming week, we have to see market recovering and closing above the 200 week EMA otherwise the next month would be disastrous for the market and it has all chances of collapsing from current levels. So at-least this time hope for the best.
Positive for the market:
RSI is in oversold position.
RSI is in oversold position.
Negatives
• Nifty is trading below 15 day, 50 day, 100 day and 200 Day EMA.
• 50 day EMA is below 100 day EMA is below 200 day EMA indicating extreme weakness.
• Nifty has moved below 200 week EMA.
• Daily and weekly MACD is in sell mode,
• Daily and weekly stochastic is in sell mode.
• Monthly MACD is in sell mode indicating weakness in the market.
• Nifty is trading below 15 day, 50 day, 100 day and 200 Day EMA.
• 50 day EMA is below 100 day EMA is below 200 day EMA indicating extreme weakness.
• Nifty has moved below 200 week EMA.
• Daily and weekly MACD is in sell mode,
• Daily and weekly stochastic is in sell mode.
• Monthly MACD is in sell mode indicating weakness in the market.
Elliotte Wave analysis:
In previous weeks I have indicated that we might be forming an expanding triangle and it appears that we might have completed fourth wave and it appears that we have started the fifth wave and it appears as per the current wave structure and we might have completed the 1st wave of the fifth wave and it appears that we might have completed 2nd wave of the 5th wave and it seems that we might has started the 3rd wave of the 5th wave and generally the 3rd wave would be most violent and devastating and the longest, which is being indicated by gap down opening. The first wave of the 5th wave was around 750 points and the second wave was nearly 61.8% of the first wave and wave would normally be at-least 161.8% of the first wave so we have chances of correcting around 1250 points from the end of the second wave of the 5th wave which happens to be around 5700 levels giving us a target of 4500(o no) we might doubt this target but if the pattern is correct then we have all chance of correcting. So now we are near the target so Elliott wave has again played its part.
Generally in Expanding triangle pattern the fifth wave goes near or below the trend line and the low the trend line is more frightening for bulls around 3800 levels really scary. Nearly 80-90% of the time it happens. So till it is proved otherwise we can expect these levels. The latest wave count is give below
The updated wave structure is given in the chart below. There are three options, so I have given the three wave counts in different colors. I would explain it in detail in the coming week. The breakup of waves is indicating the we are in for very bad days in coming weeks or months. So brace for it.
Generally in Expanding triangle pattern the fifth wave goes near or below the trend line and the low the trend line is more frightening for bulls around 3800 levels really scary. Nearly 80-90% of the time it happens. So till it is proved otherwise we can expect these levels. The latest wave count is give below
The updated wave structure is given in the chart below. There are three options, so I have given the three wave counts in different colors. I would explain it in detail in the coming week. The breakup of waves is indicating the we are in for very bad days in coming weeks or months. So brace for it.
M.Sri Mahidar
Trend is Friend.
Sunday, August 28th 19.53 IST
No comments:
Post a Comment