The fall from 6112 in Nifty has been pretty foxy for me. Smells of a 4th wave and possibility of this being C4 is pretty strong. While I was busy elsewhere for most of the last week, my positions as well as Nifty have swung from one end to the other, of what I presume to be C as an ED. Before I put across my views on the EW possibilities, let me see if there is anything else that can define a trade setup better.
Wolf Waves in Nifty
There are two WWs in the Nifty intraday charts, which are shown in red and blue colors in the chart below. Both are targeting similar levels of approx 5980. The target leg of wolfe is known to have push overs beyond the target line, which may happen in this case also. If that happens, another WW with a higher target may emerge. We will talk about that later.
I see two possibilities for the fall from 6112 as far as EW is concerned. The chart placed below shows these two possibilities in red and blue color. The red one is to be accepted with a pinch of salt and the blue one looks absolutely fine so far. However, what needs to be kept in mind is that the blue count must (and I repeat must) be limited to 5828 and a tick below 5828 will make the blue counts invalid.
Fractals of Blue Corrective
Fractals of Y:
This count would become invalid at 5828.
Fractals of Red Corrective
This possibility has further scope to go down. However, The APFs, EWO and RSI indicate that this fall may almost be over.
The Trade Setup
Long Nifty or CEs of Nifty as close to 5830 or above the blue LTL with SL of 5828 (or below brown LTL) for a target of 5980.
Those on short side, should keep a SL just above the UTL of the blue WW in the first chart of this post.
Wolf Waves in Nifty
There are two WWs in the Nifty intraday charts, which are shown in red and blue colors in the chart below. Both are targeting similar levels of approx 5980. The target leg of wolfe is known to have push overs beyond the target line, which may happen in this case also. If that happens, another WW with a higher target may emerge. We will talk about that later.
EW Possibilities
I see two possibilities for the fall from 6112 as far as EW is concerned. The chart placed below shows these two possibilities in red and blue color. The red one is to be accepted with a pinch of salt and the blue one looks absolutely fine so far. However, what needs to be kept in mind is that the blue count must (and I repeat must) be limited to 5828 and a tick below 5828 will make the blue counts invalid.
Fractals of Blue Corrective| W | 6112 | - | 5987 | = | 125 | ||
| X | 5987 | - | 6038 | = | -51 | -40.8 | |
| Y | 6038 | - | 5836 | = | 202 | 161.6 |
| Fractals of W: |
| A | 6112 | - | 6042 | = | 70 | ||
| B | 6042 | - | 6072 | = | -30 | -42.8571 | |
| C | 6072 | - | 5987 | = | 85 | 121.4286 |
Fractals of Y:
| A | 6038 | - | 5946 | = | 92 | ||
| B | 5946 | - | 5978 | = | -32 | -34.7826 | |
| C | 5978 | - | 5836 | = | 142 | 154.3478 |
This count would become invalid at 5828.
Fractals of Red Corrective
| A | 6112 | - | 5946 | = | 166 | ||
| B | 5946 | - | 5978 | = | -32 | -19.2771 | |
| C | 5978 | - | 5836 | = | 142 | 85.54217 |
This possibility has further scope to go down. However, The APFs, EWO and RSI indicate that this fall may almost be over.
The Trade Setup
Long Nifty or CEs of Nifty as close to 5830 or above the blue LTL with SL of 5828 (or below brown LTL) for a target of 5980.
Those on short side, should keep a SL just above the UTL of the blue WW in the first chart of this post.
