Nifty X-Wave Volatility: Potential Wipeout of Recent RallyDisclaimer:
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?
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Overview:
The Nifty Index is currently forming a complex WXY wave pattern on a higher degree wave. With Wave W and X completed, we are now anticipating a decline towards the psychological support levels.
Key Levels and Targets:
Initial Support Zone: 21950 - 22000
This zone is expected to provide psychological support. If the index holds below 22900 in opening session on 7th June 2024 and begins to fall, we anticipate an initial drop to this support zone 21950-22000, marking a fall of approximately 900-1000 points.
Further Downside: Below 21900
If the index breaks below 21900, we could see a continuation of the fall towards the previous lows around 21281, observed on 4th June.
Recent Rally:
Rally Overview:
The index recently rallied 1629 points from the low of 21281 on 4th June 2024 to higher levels of 22910 within the last 2-3 days.
Correction Expectation:
This rally may be wiped out as part of the corrective sequence, leading to a possible retest of lower levels before any further upside movement.
Upside Potential:
New Highs Target: Above 23338
After the corrective phase, we expect the index to resume its upward trajectory, potentially reaching new highs above 23338 as discussed in the last idea
Last Idea - Nifty - Pre Exit Poll Outlook: Bulls Above 22,400
Trading Plan:
Monitor Resistance:
Keep a close watch on the 22900 level. As long as the index remains below this level, a bearish outlook is maintained.
Initial Short Position:
Consider initiating short positions if the index holds below 22900, targeting the 21950 - 22000 support zone.
Break Below 21900:
If the index breaks below 21900, further short positions can be considered, aiming for a retest of the 21281 level and even new lows are possible
Reversal Signs:
Look for reversal signs and bullish setups near the 21281 level to position for the next potential rally towards new highs above 23338.
Conclusion:
The Nifty Index is poised for a significant correction before resuming its upward trend. Traders should be prepared for volatility and closely monitor key levels for optimal entry and
exit points.
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From WaveTalks
Abhishek
