Nifty Trading using Elliott wave, Why 17520 Must See Level?

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Nifty ended marginally higher and extended positive movement for sixth consecutive day. Overall undertone for now is positive as long as 17520 is intact on downside. Move below this level will indicate wave c is probably over. However, until then buy on dips with move above 17777 extending this rally towards 17850 levels.

We published Nifty analysis in "The Financial Waves Short Term Update" Check out below the detailed research that we published

Nifty Daily chart:

Nifty 60 mins chart:

Wave analysis:

In previous update we mentioned that “For now, one can use buy on dips strategy for a move towards 17756 (which is also an important Gann level) as long 17350 holds on the downside.” Nifty had a Gap up opening on Muhurat trading day. Prices opened near 17736 up by 160 points and closed near 17730 levels.

We have observed that during Muhurat trading over past occasions markets opened Gap up and closed lower from the opening prices. Next day there is tendency to open lower and then buying emerges later on. FIIs do not participate during this 1-hour trading and there is tendency for Big players to enter once there is a dip again post this session. Let us see if the same can be seen even today i.e. have a dip towards 17600 – 17650 levels and again buying can emerge later on.

As we have been mentioning over past occasions as well, Gann level as per square of 9 180 degree is working very well in pulling prices towards it. 17756 where Nifty flirted around yesterday is also the Gann level. Now move above the high of 17777 will keep the tone positive.

Ichimoku cloud is giving support near 17650 where the conversion line is placed. On daily time frame we also closed near the upper Bollinger Bands. So there are cluster of hurdles that Nifty has to cross from here but the undertone will remain bullish unless we close below prior day’s low.

From Neo wave perspective, we still think prices are in wave c of either a Flat pattern or Neutral triangle pattern. This can be minute wave 5 of wave c as it is showing impulsive behaviour due to Gaps which indicates impulsive trends. Move below 17520 which is low of 21st October will be first sign that the uptrend is reversing. Until then it is best to keep riding this trend on upside by way of shorting put options or buying futures only when risk reward is favorable and RSI is not overbought.

In a nutshell, overall undertone for now is positive as long as 17520 is intact on downside. Move below this level will indicate wave c is probably over. However, until then buy on dips with move above 17777 extending this rally towards 17850 levels.

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