Few days back we have discussed about the NIFTY , which was making new highs despite sluggishness witnessed in many leading stocks. The question that arose in the mind was whether the current run to 'All Time New High' is a boost to a new bull run or it is a trap for positional and day traders? Though, the answer to this question is not as easy as it seems, and who know what is held beneath the future. Still, with genuine and continuous efforts we can get better result if not best.
An hourly chart of NIFTY showing its movement from its recent low of 7893.80 (26/12/2016) to its recent high of 9218. 40 (17/03/2017). Beside, there has been shown possible wave counts, giving due consideration to EW principles. Moreover, a line drawn in connection with wave 5 of 'C' or '(iii).'
From the chart shared above and the line shown, it shall be noted that NIFTY is either reluctant to break below or taking support at the lower line of the same line. Any move below this support line may be an indication to the 'Change' in trend for short to medium term.
Please, make note that any further or new effect found in the movement of NIFTY on the hourly or of NIFTY will be discussed as and when felt necessary.
The NIFTY is probably making a simple zigzag correction after giving an impulsive movement. first two wave 'a' and 'b' seems to have completed having given move from 9019.30 to 9133.55 & from 9133.55 to previous day's low of 9024.65, respectively. The NIFTY may touch or go beyond the level of the end of wave 'a', i.e., 9133.55. However, market may witness a sharp decline in NIFTY once this upside movement finishes with finishing of the wave 'c' of the simple zigzag. The hourly chart of NIFTY has been shared below for the reference.
Nifty has shown a gradual impulsive decline and sideways correction in simple zigzag 'a-b-c' pattern, from its recent top of 9218.40. The movement in Nifty is more likely to give further decline and bears are more prone to hunt down the tired bulls.
On hourly chart of Nifty there has appeared a negative divergence. Nifty, from here onwards, might start declining sharply on breach of the level of 9020.