Yesterday I mentioned about two Wolves (Red lines in the chart below) in Nifty and expected a rise towards 6090, as there was a potential +ve divergence developing, to meet the targets indicated by these wolves. However, the first tick went way below my expectations, disturbing the entire thought process and mandating a re-look at the charts.
Nifty is moving in a channel which is shown in the brown. As I see it, the fall may be developing into a DZZ and could be targeting 5913. Going by the channel, Nifty may rise to test the Brown UTL and then fall again to Brown LTL to complete Y.C. The fractals, as I see, are as below:
Fractals of W:
Fractals of Y:
One should not forget that Y has the potential to go upto 5836 as per these fractals. Similarly, Y.C has the potential to go upto 5856.
A pictorial depiction of these counts and a reminder of the wolves (in red) is in the chart below:
The Trade Setup
Shorts could be initiated near 6000 with SL at 6006 (which will be way beyond the Brown UTL) for a target of 5915.
For the bullish, Longs can be initiated close to today's low with a SL at 5940 for a target of 6000, 6040 6100.
And for those, who want to be absolutely sure, if the waves develop the way I am expecting, look for a +ve divergence between 5946 (today's low) and the new low that could be created by day after tomorrow, to initiate trades on the long side with SL below the lowest point. Target could be very close to or above the recent high of 6112.
Nifty is moving in a channel which is shown in the brown. As I see it, the fall may be developing into a DZZ and could be targeting 5913. Going by the channel, Nifty may rise to test the Brown UTL and then fall again to Brown LTL to complete Y.C. The fractals, as I see, are as below:
| W | 6112 | - | 5987 | = | 125 | |||||||
| X | 5987 | - | 6038 | = | -51 | -40.8 | ||||||
| Y | 6038 | - | 5913 | = | 125 | 100 | (Projected) |
Fractals of W:
| A | 6112 | - | 6042 | = | 70 | ||
| B | 6042 | - | 6057 | = | -15 | -21.4286 | |
| C | 6057 | - | 5987 | = | 70 | 100 |
Fractals of Y:
| A | 6038 | - | 5946 | = | 92 | |||
| B | 5946 | - | 6005 | = | -59 | -64.1304 | ||
| C | 6005 | - | 5913 | = | 92 | 100 | (Projected) |
One should not forget that Y has the potential to go upto 5836 as per these fractals. Similarly, Y.C has the potential to go upto 5856.
A pictorial depiction of these counts and a reminder of the wolves (in red) is in the chart below:
The Trade Setup
Shorts could be initiated near 6000 with SL at 6006 (which will be way beyond the Brown UTL) for a target of 5915.
For the bullish, Longs can be initiated close to today's low with a SL at 5940 for a target of 6000, 6040 6100.
And for those, who want to be absolutely sure, if the waves develop the way I am expecting, look for a +ve divergence between 5946 (today's low) and the new low that could be created by day after tomorrow, to initiate trades on the long side with SL below the lowest point. Target could be very close to or above the recent high of 6112.
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