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The breadth measured based on the number of stocks above or below the 50dma can be a good sentiment indicator. Weakness shows lower market participation at new highs and should set it up for a correction. Diffusion indicators like this are sometimes useful, especially while gauging the short-term trend.

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The entire pattern for Reliance Industries looks like ABC, especially as we have respected the upper end of a rising channel. This perfect channel was possible because the chart is adjusted for the demerger of Jio Financial Services. If your chart is not adjusted, it may not be the same. What are the implications? Watch the RMI and trend indicators.

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The only thing I can tell you about this stock is that it is a text book looking head and shoulders top pattern and the neckline is breaking today. So will we do what the text book says? Can the size of the head be replicated. Something to think about especially as you are near the neckline that is now the resistance.

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Do you see it coming? What comes next after Z in the English Alphabet? Think about it. Even if you say A, you can count to ABC. So, three waves higher is a minimum for the dollar. But I think maybe there are bigger things happening here, like a third wave. Let the price action confirm.

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The Leading diagonal pattern in the EuroStoxx 50 index does not bode well for the European stock markets. Bounces from such a pattern do not last and at 38.2% the X wave that formed in the last 2 weeks appears more than sufficient for the start of a gigantic decline in European equities. That is how I have seen this pattern play out in the past and therefore all...

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We are at the bottom end of the 2-4 channel at 4.48% on the 10-year note yields so it may be early to say that the trend has changed even as we are in the final long-term 5th wave which is the final leg of this bull run for bond yields.

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For the first time since March, the Midcap index made a lower low, breaking the shelf support and leading the weakness. The much-awaited correction in mid and small caps is here now.

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The S&P 500 is getting oversold based on the CBOE Put/Call ratio. It is also at the bottom end of two channels, which could act as a strong support. This appears like a buying zone for long-term investors and traders alike. Just patience for managing the short-term volatility.

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Nifty managed to make a lower low today, but the RSI indicator made a higher low, resulting in a positive divergence on the chart. Now, we are witnessing an intraday recovery from there. The proprietary RMI indicator remained in buy mode throughout this time [find it on web.strike.money ]. The recent low found support on the lower Bollinger band but also a 61.8%...

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The CBOE Put/Call ratio shows too many Puts being traded relative to Calls, which is akin to previous market lows seen at similar readings. This can mean that the S&P is extremely oversold short term and due for a bounce in the next few days that can take us back to the highs. Patience is needed to see this play out. An actual price reversal should be watched out for.

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Is wave 4 done at a little more than 23.6% retracement? Wave four is a flat and wave 2 was zig-zag retracing 61.8%, so we have alternation. Nvidia is now at the 20-week average so that is an ideal support as well which held in wave 2 too. Wave 5 should follow wave 4. 5=1 then the level is at 300 which should coincide with the top end of the channel. A rising...

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The five up, three down structure is key to trend analysis when it comes to Elliott wave analysis. Using wave counts in combination with sentiment can tell you if markets have reached an extreme and completed a structure. In this case, if wave c is done, do we have any short-term sentiment indicators that are oversold in conjunction with this? The Daily Swing is a...

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This is not the first time since March 2023 that the NIfty Midcap 100 index bottomed near the 20dma. It is doing so again today. Next time we may or may not be so lucky but this is what has been happening. The two day dip means that the RSI at 60-65 is not oversold anymore on daily charts. Weekly charts may still be above 70 for a while.

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A truncated 5th wave maybe developing in the US 10-year bond yields as the pattern that has developed is an expanding triangle near a double top. Positioning shows the largest short position in US bonds net across categories. The setup is for a short covering rally in bond markets to be triggered by some event along with inflation data. This is not a time to be...

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USDINR - should have broken out this time right? Every time it has spiked up recently to near the 83 level, everyone is pounding the table. But the likes of me waiting with bated breath. I am waiting because I have been trying to anticipate a top here, but once again, for the nth time, we have a failure to move past the upper trendline of the triangle. A day...

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The dollar index ahead of FED decision day is at the 20dma and has retraced the recent losses from incoming data around weak inflation. In other words, Dxy is up only on fear that the fed will raise rates, but the data suggests that they should not. At a critical resistance, the dxy may be close to resuming its downward course. The dollar should head lower from here.

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Five waves up in Elliott Wave analysis indicate trend and direction. So when we see a five-wave move in a particular direction, that is the trend. Following that, three waves down is where the correction ends, and we anticipate another five waves up. On this chart, Nifty also fell to the 61.8% retracement mark in the a-b-c pullback making the setup ideal for the bulls.

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Rotation between stocks and sectors is a killer, making choosing stocks inside an ongoing rally difficult. What moves today gets killed tomorrow without a similar impact on the underlying index. This pain has no resolution but quick identification of failure and booking profits. But the index has a strong setup so far, holding support levels, falling in small...