Sunday, March 28, 2010

Nifty Monthly 10 year chart Marked with Elliott's 3 rd wave

It is true that  if market will move …waves will form and  there are different type of markets and so the waves ...
Trending and Range bound …
 In range bound it is  difficult to count 5 /3 waves pattern.. 
And in trending markets too there are two types of waves we can see 
 Impulsive and corrective
In TA there is no any hard and fast rule..Ellott was a clerk and he wrote his observations in 1930 and we are still following his theory. At that time technology was not so fine tuned and now we are fine tuned in technology..
Here I am placing 3rd wave on Nifty monthly 10 year chart..20022010.jpg picture by kailash123p

at 5 years monthly nifty chart  just see the unique ness of chart nifty is moving up and volume is decreasing since may 2009 and when 
big volumes were there in jan 2010 nifty corrected by 400 points ... so please care for  volumes too ... 

fncharts_export2.png picture by kailash123p
You can See at the 20 years Monthly chart too 
2003 to 2008 ...wave 1
2008..Jan 2009 ..wave 2
Feb 2009 to till date wave 3  under progress ........

fncharts_export.png picture by kailash123p

Definition of Elliott Waves

In the 1930s, Ralph Nelson Elliott found that the markets exhibited certain repeated patterns. His primary research was with stock market data for the Dow Jones Industrial Average. This research identified patterns or waves that recur in the markets. Very simply, in the direction of the trend, expect five waves. Any corrections against the trend are in three waves. Three wave corrections are lettered as "a, b, c." These patterns can be seen in long-term as well as in short-term charts. Ideally, smaller patterns can be identified within bigger patterns. In this sense, Elliott Waves are like a piece of broccoli, where the smaller piece, if broken off from the bigger piece, does, in fact, look like the big piece. This information (about smaller patterns fitting into bigger patterns), coupled with the Fibonacci relationships between the waves, offers the trader a level of anticipation and/or prediction when searching for and identifying trading opportunities with solid reward/risk ratios.
There have been many theories about the origin and the meaning of the patterns that Elliott discovered, including human behavior and harmony in nature. These rules, though, as applied to technical analysis of the markets (stocks, commodities, futures, etc.), can be very useful regardless of their meaning and origin.
Simplifying Elliott Wave AnalysisElliott Wave analysis is a collection of complex techniques. Approximately 60 percent of these techniques are clear and easy to use. The other 40 are difficult to identify, especially for the beginner. The practical and conservative approach is to use the 60 percent that are clear.
The whole theory of Elliott Wave can be classified into two parts:

Impulse patterns
Corrective patterns
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