BHEL - Elliott Wave Analysis Application : Expanding Wedge

Jan 30

Disclaimer:
Trading in financial markets involves substantial risks. Consult your financial advisor before making decisions. This commentary is not a solicitation to buy or sell.

WaveTalks - Market Whispers: Can you hear them?


Elliott Wave Analysis Insight

BHEL's stock movement is currently showcasing an expanding wedge or ending diagonal pattern, often seen in the final phases of a trend, such as the fifth wave or wave -C in Elliott Wave Analysis. This pattern indicates we're possibly at a critical juncture.

Today's High and Implications

Today, BHEL hit a peak at 234.45, a significant level under Elliott Wave Analysis. This point is crucial because it tests the cardinal rule that Wave 3 must not be the shortest, and Wave 3 should be equal to or greater than either Wave 1 or Wave 5. In current BHEL's case, Wave 1 surpasses Wave 3, creating a unique situation. The stock's movement above 234.45 or 235 could mean Wave 5 will also exceed Wave 3, violating the cardinal rule of Elliott wave analysis, which is not allowed.

Technical Indicators and Outlook

The RSI shows a negative divergence, indicating the recent rise to 234/235 might not have strong momentum behind it. This divergence suggests caution.

What's Next for BHEL?

If BHEL remains below the 235 resistance, we might see a retracement to 200, a key support level. A fall below 200 could lead to a further drop to 165.80, which would be critical to watch.

Conclusion

BHEL's stock is at a pivotal point, with Elliott Wave Analysis providing a unique lens to anticipate future movements. While the resistance at 235 is vital, the underlying momentum indicators suggest a potential pullback. Investors and analysts should keep a close eye on these levels for future direction.

WaveTalks... Market Whispers... Can you hear them?

Feb 5

Note

11:19 am / 5th Feb 2024

Last @ 238.25

It remains uncertain, even though it has already dropped to 223.20 after the idea was published. Risk management is crucial. We should wait for a trigger below 230. Despite currently trading at 238, it might be wise to avoid this stock for the next few days, even though it has surpassed 235.

Feb 10

Trade closed manually

6:21 am / 10th Feb 2024

Last @ 227


Good Morning All,

There was a sudden fall on Friday , 9th Feb 2024 - Stock slipped from 235 to intraday lows of 217 & bounced upside

So be careful as pattern unfolds out of expectation we still expect re-test of current highs & even new highs above 243.25 holding above 217 -220 zone which will be key zone for next few days