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Nifty Daily

12 Mar 2021 ‚óŹ 03:09 PM





Position Sizing model - Long % = percentage of indicators bullish v/s Short % = number of indicators bearish, Including both daily and weekly time frames.

 TIME TREND Up Level   Down Level
 Short term trend Down  15336 14800-14300

Nifty not only closed down today but kept the daily momentum indicator in sell mode again, raising the odds that the correction gets a little deeper. All the moves since 16 February market top a corrective. So even as we did not close below the 20 DMA it is possible that prices continue to fall towards 14,800. Below 14,800 the odds will increase that we are going towards 14,300 which is a 61.8% retracement of the post-budget rally. The Elliott wave counts can be marked in 2 different ways, the blue markings show wave B is a triangle and wave C down will unfold, the yellow markings show the initial a-b-c decline as w and the subsequent a-b-c rally as x. In the a-b-c scenario, we would most likely head towards 14,300, but in a wxy structure, a consolidation can happen and either 14,800 or 14,600 ends up being the bottom end of the range. I prefer w-x-y where the next move down will be wave y the size of which is unknown. The structure would be a-b-c down.

The rising trendline from the 14,467 low broke today. There is no immediate downward channel that we can draw except one from the February top of 15,431. It is only a mildly downward slanting channel, but the bottom end is all the way down to 14,400. The next swing low at 14,862 is the immediate support. 

The swing decline to 22 and has been falling for several days even in the market was attempting to go up. Clearly showing a negative divergence this seems to be playing out now. We are still not oversold on this data point so there could be another day or two of declines before that happens.  The swing would be oversold when it is in single digits.

  BANK NIFTY        
 TIME TREND  Up Level   Down Level
 Short term trend Down  36500 34000-33760

Bank nifty has been the weaker of the two,  and its momentum indicator never crossed over to the buy-side,  and prices never closed above the 20 day average over the last 6 days. The downward trending line from the 16 February high of 37,708 was where the top was made today. If prices go below 35,100 they may continue towards the lower end of the channel near 34,000. In terms of retracement, a 50% retracement would be near 33,760. 

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