Mar 042012
 

The Indian stock market rally in 2012 caught many players by surprise. Towards the end of last year, India ranked as one of the worst performers in Asia, but in a few short weeks, everything had changed. The rally in NSE India from the 4531 low has already covered 61.8% of the prior decline. But there are many questions about the fundamental reasons for this upmove.
A tentative Elliott Wave count for Indian Stock index NSE
Elliott Wave analysis is a powerful and flexible tool. We can use Elliott Waves to determine where in the big picture the Indian stock index is currently positioned. Remember that when we first do the analysis of the big picture, it is hypothetical. No one knows for sure what will happen in the future, but we use our best judgment to prepare a hypothesis. After that we start watching the minor moves to see if the market is actually confirming our hypothesis. At some point in time, it will become evident whether or not we are on the right track. Finally, when we gain suffcient confidence about the whole plan, we should move in confidently. Until that moment arrives we should be patient, but alert! The best traders know how to hold back until the most opportune moment. Then they move in aggresively. They will no longer doubt themselves. They know their risk is limited to something affordable, and they also know that unless one takes a risk, there is no reward. These are the principles I have explained in my book “Five Waves to Financial Freedom”.

  92 Responses to “Looks like Indian stock market rally is fading: NSE India”

  1. Sir, This refers to your latest analysis of NIFTY. You have changed the wave numbers little bit to accomodate wave-X. My point is that why so? What I understand is that the wave-(C) is 161.8% of wave-(a) and wave-X needs 3 waves of a-b-c structure to complete. Is this the reason to change the wave numbering? Does EW theory assigns the limit of wave-(c) of a zigzag or flat?
    Further, to add here is that probably wave-(c) is not complete with 5-waves. Only 3-waves are completed and NIFTY is currently developing wave-4, which may bring it down to around 5090 level. Incidentally, this is a resistance level from classical chart analysis of channel upper boundary and may act as a pull back. However, the channel target is 6000. Thus, a cautious approach is required.

    • Hi Bhanja, Labeling waves is as much an art as it is science. What I have described today is what appeals to me now. I could be wrong too, and the Nifty could go to the moon.

  2. Dear Ramki-ji
    Sir
    i am keenly interested in your book on EW. but it is not available in printed or printable form. due to my specs, i cannot stare for long on the screen to read a book. i wonder if there is a way out to get your book in any printed or printable form thanks for your great education
    best of regards
    Parimal

    • Dear Parimal, I am sorry to hear about your eye problem. Unfortunaltely, at present the book is only available in Digital format. Besides, there are numerous useful links in the book that will be lost in a printed version.

  3. I hope I am not getting carried away but I have been toying with this wave count for some time and you are the first elliottician to have done so, none other agrees with me. So I am waiting patiently for a confirmation because it means a new low. I wonder if its right to see it as an expanded flat, tried searching for similar examples in the past, if you have any do let me know. In this particular case would wave b be a triangle?

  4. Hi Ramki,

    Could you please elaborate a bit on the pattern which u expect to unfold as per your latest count. I understand, we have already done a triple zig zag and you were also a bit bullish after 4531.

    I just want to understand the latest wave structure which prompted you to change your view. Also, this is not to question your judgement but more to understand and learn the same.

    Regards
    RS

    • Hello RS, Being bullish when it was near 4530 was the right thing to do at that time. Now I am toying with the idea of turning short when the time is right. The markets never goes in one direction indefinitely. Armed with Elliott Wave Analysis, you can take low-risk trades on both sides of the market. As for future patterns, it is too soon to discuss that.

  5. Dear sir, I was also expecting the same as there was head and shoulder in weekly line and nifty got reversed from the neck line itself..

    • Abhinav, Thanks for your comment, but I dont see any head and shoulders pattern in Nifty.

      • Dear sir
        Can you pls express how you observe head and shoulders pattern,
        i mean whats your criteria for a head and shoulder to be perfect….

      • Hello Sir ,
        I think Abhinav is referring to the following H&S formation , which got broken downwards in Aug ’11 and got tested once in October’11 and again in Feb’12. :
        Regards
        Sachin

  6. if you can please give a update on eur/usd.

  7. Hello Sir Ramki-ji,
    Your study of Nifty suggests that at around 5100, ‘fourth’ wave may come to an end and that will also be the probable beginning of ‘fifth’ wave. Am I right, Sir?
    Regards
    Parimal.

  8. Thanks for sharing your g8 knowledge with us.
    As per your previous S&p 500 chart we already reached to 1377 level, now is it going to be wave iv of major 5. Please update on S&P 500.
    thanks,

  9. Sir,
    one simple question can we lable this as wave B instead of wave x where in we have had wxy as A and expanded flat as wave B which might still be in play with one more high remaining and a wave C where in new lows come in. if this is true than how much does a WAVE B normally retrace of wave A
    WAVE A = 6335 TO 4720
    WAVE B = 4720 -5400-4532- ?(5630)
    WAVE B retracements
    50% retracement is 5527 whereas 61.8% is 5719 and 70.7 % retracement is 5862

  10. Sir,
    I am so much thankful for sharing ur views on Nifty which was awaited in this tremendous time.
    As per my view, Nifty may go deep and make new low around 3900.
    May I be right?
    Please guide…

  11. Dear Ramki Sir,

    Thank you for your magnificent book. In the Nifty analysis which you had shown, why do you think Nifty will form a double top at 5600+, the approximate levels of X (c)? Why will the Nifty not go any higher?

    Regards,

    Suresh

    • Hi Suresh, as of now it is just conjecture, because if wave 5 is already over then we may fail there. Also 5630 is 61.8% of whole down move so far. The post is a preliminary idea, and we’d change it as mkt unfolds

  12. When the market goes up we are all bullish,and when the market comes down we are all bearish.I suppose this is more of a chicken market.Yes,even if the market is bullish,an ABC correction after the rally is obvious as wave 2 and this could happen in the next month,that is , April and in that case too market can come down to as low as 4800 levels.

    • Ashutosh, I am happy you made these observations because now I know you are beginning to get EWP in your thinking. When mkts finish a 5 wave move it must correct, this is what non Elliott wave traders don’t appreciate. How far down fom here depends on your count. If you think we will start a new 3rd wave up, then you will not remin bullish. Eventually everyone will be proved wrong, including me. But my objective is to make money, not be proved right

  13. Dear Ramki-ji Sir,
    i highly appreciate at least three great qualities in your persona:
    1) your flexibility in wave counting,
    2) your spirit of sharing your great knowledge (i wish i could possess your depth of knowledge),
    3) your continuous guidance (your holiday was painful for me)
    thanks a lot Sir Rakmi-ji
    i shall certainly get your book and take some pain to read it on screen.
    best of regards
    Parimal.

  14. Ramki Sir,

    Exactly why did you change the counts from a preferred bullish count to preferred bearish count as of now?
    Was it because 1) the fundamentals didn’t change much even after rally?
    2) or was it something related to EW?

    • Hi Manohar, I am never a permanent bull or a permanent bear. I was bullish near the lows and bearish near the highs. That is what matters. There were Elliott Wave clues that suggested we could come off from near 5630, just as I think we could see a mild bounce from 5080 levels.

  15. Dear Ramki Sir

    I have not been able to understand one thing, as to why have you labelled waves as a-b-c-X-a-b-c-X[with sub waves a,b,c] instead of a-b-c-X-a-b-c-X-a-b and C wave in the making. Why I am asking this is because I have not been able to spot any example where in the X wave has taken a shape of irregular Flat. Pls guide as I am new to EWP.

    • Hi Sandeep, thanks for your comment. Please read my response to Antinio. Secondly, you say you have not seen an irregular X wave so far. Congratulations. You have seen your first instance here!

  16. Hello Mr Ramki,
    I am studying the Elliott Wave theory as you explain it in your book with great interest and fun, and although I realize it is really difficult to follow you with your huge experience, I would appreciate very much If you could explain why did you labeled a red (a) instead another X.
    Thank you for your time!
    Antonio

    • Hi Antonio, Normally, we dont get more than three sets of ‘abc’s in a complex correction. If I labeled red (a) as an X wave, then the third abc would have been finished already. However, by choosing to call that as just an 9a0 wave, I manage to respect some of the guidelines decribed in Five Waves to Financial Freedom book. Dont worry too much with labeliing corrective waves properly just now. It is never easy and people make lots of mistakes, (including me). The goal of all analysis is to make money, not to showoff you are a good analyst.

  17. Sir
    I try at my level best to learn EW analysis.
    Nifty may bounch back from 5080-5090 and touch to 5492. Then it may deep to 4440-3930.
    May I right?

    • Hi Salim, Of course you could be right. However, no one knows the future, so you have to trade your theory with suitable stops. What I have done is to teach you the concepts. Now you are on your own!

  18. Dear Ramki-ji Sir
    i have been keenly noticing your technical analysis based solely on EW alone. it is apparent that you do not use any other indicator or parameter to analyze a stock with a view to get confirmation. this is something quite unique feature of your style. it simply conveys that you can fully depend on EW principles. is it possible that you give a little clarification on this if you have time or your book on EW elaborates this aspect convincingly.
    wishing you Happy Holi.
    regards
    Parimal

    • Hello Parimal, thanks for your comment. The trend is your friend, as the old adage goes. Other than that, I mostly depend on wave analysis

  19. Jan 2008-6351-wave one
    Mar 2009-2252-wave two
    The Nov 2110 top of 6338 was wave one of wave THREE and the ongoing correction is wave two of wave THREE.This time, sir,you are making perfect sense.Market may really correct to the levels shown in your chart.The only confusion for me is why market will go up to at least 5600 levels as suggested in the chart after coming down to 5090 levels?Will that be an X WAVE after an irregular correction in the 4th and market will go up to 5600 as the 5th while the longer term trend still remains corrective?Or what?Please comment.This information will give me passing marks and I will gain in confidence.Kindly try to post an elaborative chart showing the minor waves of the current phase.I would ever be grateful to you.Also,if the market breaches 5050,shall we go short?

    • Ashotosh, How far we recover from around 5090 will be decided by various fundamental factors. We need to see the Wave A first to determine targets. As of now, what you see on the chart is just a broad road map. I would not sell on any direct break below 5090 because that is not my style. I prefer to be patient for low-risk entry points, and WaveTimes is all about that

  20. Hi Ramki

    first of all Happy Holi to u n all readers!!!!!!

    Since i read ur blog and a couple of others, i like to share my view, and also would like to get an insight from u. we completed bigger wave 3 in 2007 at 6100 then formed wave A of wave 4 at 2250 in october 2008. irregular B of wave 4 at 6338 in nov 2010 and now starting wave C of wave 4 with tgt of around 3800 ( i m expecting wave 4 to be a wedge and wave C of wave 4 targeting 61.8% of wave A of wave 4)

    different picture as per weekly/monthly wave
    secondly we completed an extended 5 at 6338, formed wave (A) at 4720 then wave a of wave (B) at 5400 then irregular wave b of wave (B) at 4531 and now formed wave c of wave (B) at 5631 (=161.8% of wave a) …. AND NOW wave (C) starting with C=A at 4000 and C= 1.23%A at 3650

    pls correct me ???

  21. Dear Ramki Jee,

    Sir, Need your weekly update for Nifty – Please !!

    Regards
    Alok Surana

  22. Dear Ramki Sir
    at what point of time and which movement of Nifty will give a signal that may herald probable beginning of 5th wave
    thanks for your time
    best of regards

  23. Hello Ramki,

    Very interested in your forecast for the Indian market. I am from Russia. The movements of Russian and Indian stock markets are very similar.

    Could you take a look at the Russian index MICEX (Thomson Reuters code – MCX).
    Do you think the movement from the level 1860 down to 1240 can be considered as initial diagonal triangle?
    I am considering moving up from the level of 1240 as correction and the price reached the level of 61.8 of the down movement. Can we now assume the correction is completed?

    Thank you for your time

  24. OMG !

    All valuable discussions took place here on Nifty and I was looking for it in the older post!

    What an awesome in-depth live analysis Ramki sir !

    This is best complimentary gift one can have once he/she goes through your wonderful on-line book !! Excellent work sir as always…hats off !!

    EW is complex subject as such and not many could master it however hard they tried…but after reading your book we are almost at 70% of it !!

    Humbly request you to kindly keep posting your counts and analysis on NIFTY so that it will help us truly master your book….meanwhile we users discuss it among ourself too !!

    Fundamentally…
    1) GREECE music is almost over.
    2) Presidential BULL cycle in DOW is doing ok so far….so bulls in global indexes are still alive !
    3) Govt via LIC brought lots of stuff in wave 3.
    4) CRR cut of 75 bp kind of sign that banks may again take the driver seat and take Nifty along !

    best rgds, SB

  25. Hi Ramki Sir,

    I read the book “Five Waves to Financial Freedom” and it is one of the best book on EWP. Great work. It is short and simple, moreover it is “Applied EWP book”. We can make actually money out of it rather than just discuss the principle.

    I am following your tweets and read your each and every bit on EWP. As you say in this chart “Every trading notion starts with a hypothesis” its true. Many times my hypothesis went wrong but still made enormous profit. Kudos to Elliot wave principles and its teachers like you.

    thanks and regard
    Ritesh.

  26. Hi Ramki, thank you very much for everything so far,
    For SP, your last analysis worked and hit 1378.

    What is your last suggession for SP

    Than you.

  27. Dear Ramki,

    Wrt to the above count on Nifty, what are your thoughts with Reliance’s overlap at 753 (Reliance move means its an ABC not 123). Does the overlap increase the confidence that Nifty is headed lower or does it point to something else?

    Best regards,
    BJ

  28. sir,
    2dy high is 5460..

    do we expect more or what should be the sl strategy for a short trade?
    prvs high ?

    • Hello Manu, Thanks for the comment.WaveTimes serves as my contribution to share my knowledge of Elliott Waves. It is a place to learn some of my techniques.I am currently not offering any advisory service….

  29. dear sir , i purchased u r book ,i read it ,it is really simple to understand ,e w analysis. u correctly said that it is art . pls update silver ,gold mcx analysis .

  30. Dear Ramki,
    I am really impressed with the way you present the views based on elliot wave, Your last updation on nifty surprised me that nifty can break recent lows. it will be really helpful if you update and throw some more light on that.

    awaiting your response,

    Sailesh jain

  31. This is the beauty of the 4th wave.So we have another zigzag.The rule is that the 4th wave wouldn’t breach the top of wave 1,that is,5076.What perplexed me the day before yesterday,I was just helpless while counting the minor sub waves of the last leg.I should have realized that I must not conclude as to the finish of the 4th wave,eh !

  32. Hi,dear sir Ramki,
    Sir, march month is over ..this month give us so volatality & spaky movment but nifty not give clear view that we r heading with ” Ew” so plz if u need to update the right time on nifty so plz put on yr blog OR plz say were we r heading in this complex correction ?
    regards
    Alpesh

  33. We are still on the 4th of the bigger ONE(C4).The c5 will bring Nifty to as low as 5070.If Nifty seeks support here,then Nifty may go up to as high as 5652.However,a truncated fifth can’t be denied.We have to wait and watch for the pattern(a diagonal) to unfold.Cheers!

  34. Dear Ramki,

    As per EW 4th wave correct up to 38.2% or (in extended case it is 50%),now Nifty comes down @5205 which is 38.2% and then after again it is come down @5135 low ,so is i believe that it must comes 50% level which is comes @5077 or take a low 5135 is final ABC correction finished of 4th wave and 5th wave in now begin…?????

    Please send me reply , i had do hard work for this nifty chart.
    Going with ur motto (getting rich slowly and stady)

    Regards.
    Prithvi

    • Hi Prithvi, before a wave is finished your count is as good as anyone else’s. Try to understand HOW to use the EWP rather than trying to become an expert in forecasting.

      • sir,
        Give ur comments on nifty as there is lack of clue in the chart.

        • HI Salim, please read my comments of 4th March. DOnt you think the market is behaving like what was suggested there? Instead of 5090 we went to 5135 and are recovering.

          • Yes sir, u are right .
            mkt going as per ur levels only as predicted and analysed in EW analysis

          • sir,
            I think market mat resist @5440 which is 61.8@5630-5315 and may correct upto 4640-4140.
            May I right?
            Pl.comment.

          • Salim, anything could happen. If your analysis says that, you need to know when you will be proved wrong, and so whether you can afford a stop that corresponds to that level.

  35. Dear Ramki
    need some clarification on a point— we completed the bull phase in nifty in 2007 at 6279, then fell to 2250 which is being considered as wave A, then all the way retracing the fall and giving a new high at 6301 forming a wave B .
    Now my question is if A is an impulse wave and B is correction, then how can wave B have 5 waves (must be A-B-C )?? Also, wave 3 of wave A is again 3 wave structure??PLS put some light on d same.

    • Hi Lucky, wave 3 can never be in 3 waves. If you think that the 6301 high was a B wave we shoud get a 5 wave decline for C wave. Such a Development would take a new crisis to hit india

      • Dear Ramki Sir,

        Can you please clarify on this correction of B Wave, Since you have applied 5 wave counts to it. Also if you can give long term counts for Nifty. Thanks

  36. sir,
    is there chance for bounce back from 5090 as it was go up from 5135 last time

    • Salim, There is some mild support aound 5145/50 and a chance for a mild recovery. But the short term picture is mixed. I will update NSEI when there is something important to say.

  37. Hi Ramki,

    The move from 2250 levels back to bull market high appears to be impulsive. Post triple zigzag sharp move from 5100 to 5640 appears to be impulsive. Nifty currently in wave 2 which is corrective and formed a triple zigzag.

    If so the current pull back after testing 200d EMA at 5145-5150 levels may make a fresh upmove till 5900 levels?

    • Hi Jagadeesh,
      PLease read my response to Ritesh earlier. Your bullish count is as good as another person’s bearish count until one of you is proved wrong. That is the right way to approach the markets. At certain points, it is crystal clear, and at such times, we can commit funds. At other times it is mostly academic

  38. any new analysis on indian stock market?

    • Hi Jani, I did look a the Nifty today, but I could not come up with anything worthwhile to write. Will try to post an update before I go away on my vacation

  39. Master,

    Please you must update on nifty before going on vacation.

    Regards,

    Prithvi Raulji

  40. Sir,

    Your revised view on Nifty is requested. As suggested in this post Nifty could neither make 5600 top nor it dipped to 4100 in April12. Your revised guide line is requested

  41. Sir
    Nifty goes down and break 200 dema 5150 on closing basis and 5090 also. I think now down move will be fast. May I right sir?

  42. NSE has gone into a range with indications of a break down appearing after last Friday’s steep fall (on 04/05/2012). And going by the indications of top European markets, it seems bear market is resuming out there. Sir, request bit of guidance on reading the range of Indian market. Though it does appear a triangle, unable to figure out if it’s part of Wave 2 (3 wave correction) within the larger retracement (5 wave corrective move from 4530 to 5600) or is the corrective wave done? Thanks in advance Sir.

  43. Hi Ramki,
    I have gone through your book. Can you please clarify my below doubts?
    1. when you say wave 1, 3, 5 extended
    2. I have gone through Nifty as per me Nifty is in still wave 4. I can see that we are not forming contracting triangle as 5136 broken now it means we are forming ZigZag. Wave A is impluse which we have finshed already. Whether it is possible to have contracting trianle in wave B of Zigzag which we have finished and started wave C.?

    • Hi Santosh, Thanks for writing. My book gives you a sound introduction to applying the Elliott Waves to the markets. Unfortunately, I dont have the time to coach individually…hope you understand. May I suggest that you post your questions in the forum, and other EW enthusiasts will surely help. That way, everyone will learn. Best wishes.

  44. nifty : indian stock market
    i have been reading your comments on nifty and am impressed. sir i have been practising simple technical analysis and after extensive research of my own i have come to conclusion that nifty once will touch the low levels of 3650points in the next 18 months. please correct me. thank you

    • Hi Jiten, thank you. I always stat with the premise that just about anything is possible. I see that you are starting with the view that Nifty will go down to 3650. Now ask yourself what you are going to do about that. If you are going to trade that view, where will you enter, and where will your stop loss be? These questions are what I am concerned with in my book. Good luck.

  45. RAMKI SIR
    Today nifty made a low of 4990 sir we expect nifty above 5280 or nifty go towards 4900 level . Please guide us sir.

  46. Dear Ramki,
    As per your view about nifty , Its take recovery from 4988,not close below 5080-90.
    Today Nifty made low of 4988,
    So now can we believe that in daily base wave-4 correction is A=5171.45 ,B=5499.40 and C= 4988,
    And fresh wave-5 starting today for a tgt of 5609 or 5629.

    And in a weekly trend . A=4531 B=5609 and C=3780 .

    May be this scenario for only work today’s low, if tomorrow make new low than the label are change.
    But your technique is really very good.

    I know your answer,
    Your answer is ‘Prithvi anything could be happened, Don’t make your self as a expert,but make money for yourself from market.’

    Sure sir,
    I never follow other technique in future only sticky with EW,It is sure technique for Market.

    • Hi Prithvi,you are not only gaining experience with Elliott waves, but also getting good at anticipating my answers! :-)
      Good luck!

  47. Sir,
    I do not know any analysis. But like to see & get hint from your analysis for level & timing to my benefits. Request to kindly give your updates on NIFTY before you proceed on your vacation….

    Thanks in anticipation
    regards

  48. Dear Mr. Ramki,

    It has been long since you have written about nifty. After all the turmoil NIFTY has gone through since your last post, request you to share your thoughts on way forward for NIFTY.

    Regards,

    Pravin

  49. Hi Ramki,
    Do you see on Nifty Daily chart still we are in wave c of wave 4 as wave 4 retrace more than 50%?

  50. Ramki – how do you see the nifty panning out

  51. sir could you update the EW COUNTS on this chart. would be really helpful

 Leave a Reply

(required)

(required)