Nifty: How to identify Right Trading Strategy

Technical analysis is all about trying to find out the best fit or methods that are currently working in the markets. There are various methods from the basic support and resistance level identification to the complex patterns of Elliott wave- Neo wave and Time cycles.

Despite being an eventful and non- trending market since past few days we managed to capitalize on short term nifty movement in both the direction.

Now look at the below chart of Nifty that shows important pivot levels. A pivot level is essentially the area which results into reversal by either acting as a support or as a resistance

Nifty hourly chart:

(Below is the extract taken from the daily equity research report published on 22th May 2020)

Elliott wave analysis

From technical perspective in the previous week we continued to see that price has been trying to move in range of 8800 – 9200. We have much talked about 55 days Time cycle that it is getting due in last week of May and any correction should usually happen before that. As of now we can see that instead of price correction there is more of time correction in past 4 weeks.

We can clearly see that the majority of move on Nifty has been happening in just 1 to 2 hours and it moves in non-trending fashion on most of the days. It is therefore important to trade with smaller positions unless momentum picks up in either direction.

In short, trend for Nifty continues to be sideways with important support coming near …. level and resistance at …. Time to be alert and not complacent as the trending move is now due to emerge.

Below are the trading strategy given over past 2 consecutive days and it has worked out brilliantly well on Nifty:

Trading Strategy given on 21st May morning– For today, long positions can be created above 9100 with 9030 as stop and target of 9170 levels BANG ON!

Happened– Prices moved precisely as expected and made intraday high near 9178 levels.

Trading Strategy given on 22nd May Morning– For today, Short positions can be created below 9040 with day’s high as stop and target of 8990. BANG ON

Happened– Nifty moved precisely as expected despite of RBI monetary policy event and rate cut.

The above clearly shows how one can capitalize on wave theory to form the trading strategy which we mentioned in our “The Financial waves trading update”

Daily Nifty trading research report gives the trading strategy for the day and equity research report gives outlook on stocks as well. Get access to “The Financial Waves short term update” and “Nifty trading update” here.

Upcoming Mentorship – If one can combine these methods in disciplined fashion along with advanced Elliott wave, Neo wave it provides a lethal way of trading the markets. A mentor is an important link in all aspects of life who can translate years of experience into a small capsule of time. Register for the upcoming Mentorship in June 2020 Know more here or contact on +919920422202