BSE Sensex Elliott Wave Short Term Count

Happy New Year. Hope this year is either profitable or educational. Lol...

A quick review.
1. The december 6th post posted with the sensex at 16988 caught another head and shoulders pattern. The post pointed to a toping range of 17000-17200. The next day the market topped at exactly 17003.71.
2. On the 16th December in comments i posted the pattern was formed and was a 1200+ gain from the post. But i didnt instruct a close of the position, to give leeway to further downside and resolution of the pattern.
3. On 4th December i advised a top with a new short at 15863 with a stop at 16000.

So I assume as of today you are either stopped out from 4th december (-140) or still short from 6th dec (+748) or used 6th dec post and the 16th december stop and are (+988)  yeah right dream on..

Moving on
I thought i would do a post back on the 4th while still on holiday, but luckily the market decided to just drag on, so a week later i find my self looking at approximately the same targets and an extended chart pattern, and an upward move that seems to be very close to termination.
I will start the year with a 30 minute chart just to be safe, and follow it up later with something longer term when the short term resolves.

The chart is an (X)-a-b-c of a C retracement wave of larger degree. My target is 16311.58. This whole area between 16200 and 16311 looks like a shorting area. So short at will, the higher the price the better..
Posted on 11th Jan, @ 3:20pm IST with senxex at 16173





 

BSE Sensex Elliott Wave Short Term Count H&S

As per an alternate count todays move to 17000 could be another short term top. But at the risk of another termination count getting blown out of the water by coordinated central planner illusions, i decided not to post a count. Instead i post something easier to comprehend. An old school Head and Shoulder formation on the daily chart that is in the process of forming a right shoulder. You can revert to the October 31st post for an explanation of the pattern.
Between the count into today and the H&S pattern that leaves a topping range of 17,000-17,200. I expect this to be tough resistance.

Posted on Dec 7th at 2:00pm IST with Sensex approximately @16988
As usual realtime updates in the comments section.

BSE Sensex Elliott Wave Short Term Count

Even though this is a short term count, the implications are long term, since this is a short term rally in a downward market.
My last count on October 31st was able to catch a 2000+ pt move in the Sensex. A full break up of this count is below in the first chart.

The second chart is the retracement stage of this move. The retracement count is picture perfect A-B-C-X-A-B-C which i think is almost complete with only a 3rd, 4th and 5th wave of the C pending, and I think will end approximately with the sensex @ 16200. From there we have 2 options

1.) We rapidly break the lows on the 23rd of November @ 15478

2.) The retracement is not complete. The caveat here is that retracements are harder to count and the current move that i have counted as A-B-C-X-A-B-C is part of a much bigger retracement. So that means we get a short term bottom @15478 ish  and then we might go above 16200.

Either way there is a short term top in the 16200 area which can become either a longterm top or a short term top.
Posted on Nov 28th at 2:20pm IST with Sensex@ 16085.90 
As usual realtime updates in the comments section.

The Bull Fighter

Like anyone else I am often asked as what I do for a living. My response?? "Bull Fighter".
The media constantly throws bullshit at people and it seems like my job (for those who seek to employ me) is to constantly fight this bullshit and try to provide an unbiased opinion on the state of the financial markets. The internet provides us with an easy opportunity to go back and check who said what, how it turned out and most importantly what their motive was when they said it. After some time bullshit becomes easier to spot.


In its purest form: My correspondence with a Bloomberg Editor. The same thing happens repeatedly, but i don't get paid to deal with it.

 In its most dangerous form: Famous Permabulls with an Agenda and market moving reputations.
Article: http://www.bloomberg.com/news/2011-04-17/dubai-stocks-offer-value-as-index-in-bull-market-templeton-s-mobius-says.html#
My comment on Facebook at the time.

 The DFM chart with April 18th marked is approximately 22% lower today and breaking historic lows!

Hopefully when the market gets bullish I will feel it coming and start fighting the Bearish Bullshit.

Hoping to stay the Bull*&%# Fighter.

BSE Sensex Fractal

A fractal is a pattern that repeats parts of its self within its self. I was introduced to the concept during my study of Elliott Wave.
There is a whole lot of computer generated fractals that you can google, which i find great for desktop backgrounds.
The reason for this post is that the intraday chart of the Sensex (top) looks very similar to the daily charts of the Sensex (bottom).

BSE Sensex Elliott Wave Count H&S

On August 5th i wrote about the head and shoulder pattern in the BSE Sensex. This pattern broke down soon after and a measured move from the breakdown would be 13000 ish . A natural progression of this pattern is also a test of the neckline after a breakdown from underneath. A textbook definition of this chart pattern can be found here. I waited for that test all of September but the closest it came was approx 17,250 on the 8th and 21st of September. The Friday close of 17,804 tested and closed perfectly on the neckline. In my post on October 9th the 2nd option which was short term bullish also talks about the head and shoulder neckline retest with a final target of 17800.
The chart below shows that this has been achieved.

Elliott Wave Count.
As per the 2nd option on the October 9th post, we revert to the September 11th Count. The move from the 15th of July to the 26th August is a red (1) and as expected the Red (2) has expanded and finally completed on the 28th October with the neckline retest discussed above. Red (1) and Red (2) currently seem like the first 2 waves of a 5 wave pattern, to the downside.  


This time i think there are no two options, just one.
DOWN
I think in the next 2-3 weeks we will be back at or below 15750.

S&P500 Musings

Below is a comparison of the spy in 2008 and now. The topping pattern came in the form of 3 peaks in 2008. The third peak shaped like a scissor blade followed by a decline, a slightly lower decline and then a 16 pt rally. The current top is similarly shaped with the latter half of the pattern seemingly more volatile. Totally surprising? Maybe not! Although the currently rally has come at an extraordinary pace (2.5 months vs 1 month), in form it looks just like the 2008 rally.

Fibonacci Observations.
The March rally in 2008 was barely a 61.8% retracement of the decline of that time. But if compared to the decline from the 2011 May highs (29.75pts) it is very close to 61.8% (18.39 as on 24th October) versus the 2008 retracement (16.15pts).
Of course, with the EFSF gimmicks the Oct 24th high is long gone, but we can now look to the 76.4% retracement level @130.16 which is not too far above, and should be tough resistance.