Positional One Pager Report on DE30

DE30 @ 9660 stop @ 9810 TGT 9410 – 9160 – 8910 - 8800

Elliott Wave Theory was developed by R.N. Elliott and popularized by Robert Prechter. This theory asserts that crowd behavior ebbs and flows in clear trends. Based on this ebb and flow, Elliott identified a certain structure to price movements in the financial markets. The article serves as a basic introduction to Elliott Wave Theory. A basic 5-wave impulse sequence and 3-wave corrective sequence are explained. While Elliott Wave Theory gets much more complicated than this 5-3 combination, this article will only focus on the very basics.

There are two types of waves: impulse and corrective. Impulse waves move in the direction of the larger degree wave. When the larger degree wave is up, advancing waves are impulsive and declining waves are corrective. When the larger degree wave is down, impulse waves are down and corrective waves are up. Impulse waves, also called motive waves, move with the bigger trend or larger degree wave. Corrective waves move against the larger degree wave.

From the above chart de 30 has started its upside rally from the level of 8830$ and tested the level of 9771$ which was the starting of the Wave Theory and it was the I Wave. There after minor correction was seen from 9771$ to 8488$ in the form of wave II  which was just near to 50% retracement of wave I, there after it enter in wave III. Looking at the wave III it tested the higher level of 9427$ and it has retraced by 135% of wave I from the bottom of wave II, and exactly tested the higher level of 9427$ and started its correction in the form of wave IV. Wave IV retrace by 64% of wave I and tested the level of 8984$ which was way above the top of wave I and failed to trade below the same and reverted and confirming the wave V. Wave V retrace by 97% of wave I testing the level of 9801$ which was smaller in length of wave III confirming the completion of wave V. After completion wave V at 9801 we have seen retracement in form of wave a and tested the level of 9074 which was just near the previous bottom of wave IV and taking support at same level and bounced. This rise was in the form of wave B where it moved from 9074 level and is tested the level of 9684$ where wave B retraced by 84% of wave A and is showing sigh of entering in wave C. taking 121.8% retracement of wave A we can look at 8800$ as the next target in DE30 in coming days. DE30 is nearing the strong resistance around 9700 to 9800 and we might look at sharp correction in DE30 soon, which might enter in corrective wave in form of C pattern.  On lower side support is seen at 9600 level and sustain trading below the same on weekly closing will confirm the down trend and any rise near the range of 9660 will be a good selling opportunity where advisable  stop to be placed at 9800 and wait for downtrend to continue.