Wednesday, December 31, 2014

Elliott Wave Analysis Report of Nifty for 31 Dec 2014 by Deepak Kumar

Nifty opened Gap Up today but declined sharply after opening and traded with negative bias though out the day followed by sharp bounce in last session. Nifty closed 1 point up at 8248 after registering the low of 8211. Let us see what charts are suggesting.

This is 5 minutes time bar chart of Nifty showing bounce after 8148 which I am assuming as start of next upside impulse.

It seems wave 1, 2, 3 and 4 are already completed and wave 5 is in progress. The wave I am marking as 3 and 4 also have possibilities to be inner waves (iii) and (iv) of 3 which I shown in my yesterday report. Confusion between 3 and 4 or (iii) and (iv) of 3 will be cleared tomorrow or later and we need to wait for that. But, in both cases Nifty needs to break above high again.

Wave (4) seems completed as Double Zigzag (abc-x-abc) as marked on chart. I am assuming it as double zigzag as it is not forming clear wedge pattern if I draw line joining end points.

If I am right at identifying then Nifty can move above 8278 once again tomorrow. There is identification of small wave 1,2 and 3 at the end (marked by blue rectangle). Let us see that move closely.

This is again 5 minutes time bar chart of Nifty showing move after today’s low 8221. It seems wave 1 and 2 are completed and 3 is in progress. Wave 2 seems like Complex Correction (Triple Zigzag ) as nature of breakout after completion is also convincing. Nifty didn’t enter in wedge again after breakout. This condition is also suggesting more upside but it should not break below 8238 again to remain in this pattern.


Current set up on chart is suggesting upside well above 8278 and stop loss for existing longs should be 8238 spot now. I exited my previous longs when Nifty opened above 8250 but break below 8240 (as I mentioned in my yesterday report). I initiated longs again around 8235 with stop loss of 8219.7. I bought at 61% retracement of wave 1 with stop loss below start of wave 1 (shown in second chart) and also posted on my Facebook group “Practical Application of Elliott Wave Theory”. And I am holding my longs with 8238 spot as stop loss for tomorrow.