NIFTY - ELLIOT WAVE COUNTS

Nifty: Elliott Wave (Weekly Chart)

Where are we, according to Elliott Wave Theory?

Let us start from the low of 920 (week ended May 2nd, 2003)........... that was the major Low!!!!!!

From this low of 920, Nifty made a high of 2014.65, for the week ended Jan 9th, 2004 (marked in RED in a box). This was wave 1.

Thereafter, a correction happened!!!!!! which took the Nifty to a low of 1292.20, for the week ended May 21st, 2004, also marked in RED with a box, this was wave 2. This was 0.618 of wave 1. From this Low a new bull phase started.......... A WAVE 3.

From the low of 1292.20, Nifty went upto 2120.15, for the week ended Jan 7th, 2005.

This was wave 3.......... But wave 3 can never be the shortest wave!!!!! it should atleast be 1.618 of wave 1...............

Calculation for this is as under: 2014.65 - 920 = 1094.65 1094.65 * 1.618 = 1771.14 + 1292.20 = 3063.34 But the high was 2120.15, so this means: wave 3 should be sub-divided. We label this wave as wave 1 of a larger wave 3(the whole of wave 3)

A correct after this wave 1 (2120.15) ensued till 1896.30, a wave 2 which was a flat. This was a correction of 0.236 of wave 1. A further rise took the nifty to 2669.20 for the week ended Oct 7th, 2005. Again, considering the wave structures wave 3 should be 1.618 of wave 1 which comes to 2724. which it is not!!!! so we label this as wave 1 too. So we are having a sub-division of wave 3 of wave 3.

All these wave happening here are adhearing to perfect Elliott wave theory!!!!!!

Since the wave 3 is sub-dividing, the overall wave 3 target ie a wave 3 of RED color with a box should be increased to 2.618 & there after. So, with a multiple of 2.618 of wave 1 we get a target (tentatively to) 4156.

All the corrections which have happened after every impulse gave a perfect fibonacci levels!!!!!

Please check the chart for further clarifications. The chart is self explanatory!!!!!!!!

If seen from this perspective, Nifty currently at a very crucial fibonacci level. A good 0.382 correction is appearing. A good support. If this is taken out then we may see some more down side.

Since wave 2 did give a correction between .382 & .5 of wave 1, then we might get support right here or we can see a further fall till .618 level, because Elliott wave have to follow a rule of alternation.

Considering, the severety of the fall in the past couple of days anything can happen, Markets might get arrested here or might move down to 0.618 level. Correction getting over around the level of 0.5 is very rare in the current scenario. Presently, since the top of 3774.15, nifty has already entered a flat correction, an abc correction. A wave b was more than 0.618 of wave a, so a criteria of a flat has already been met. What we are seening is an elongated flat correction where wave c can be more than wave a. Already wave c is more than 1(closing was right at 1 of wave a), but the larger picture should also be kept in mind!!!!!! a good 0.382 level.