One Pager Report on DE30 (DAX)

DAX (DE30) Sell below 9900 CMP 9930 Stop @ 10050 TGT 9300 – 8700 - 8028

 The basic pattern of the Elliott wave principle, how price moves not in a straight line but in a series of rises and retracements. Except for unusual circumstances, price moves in waves and not in a straight-line run. These waves are like the tide coming in. Price advances and recedes, advances a bit more and recedes, slowly creeping up the shore. The outgoing tide shows the wave advance not as far as previous waves, and withdrawing further. The motive phase is composed of three advancing waves, 1, 3, and 5 and counter trend waves 2 and 4. Following the motive wave comes the corrective phase. It shows two receding waves, A and C, with a counter trend wave between, B. The series, 1 through 5 and A through C can be repeated to show how the tide comes in, or price advances up the chart. If you were to zoom in on waves 1 and 2, you would see the same 1 through 5 and ABC combination. You can say the same about waves 3 and 4, 5 and A, B and C (with the structure reversed). In this manner, the cycle is fractal, meaning the closer you zoom in, the more motive and corrective phase combinations you see. If you were to zoom out, say look at the structure from across the room or from the other side of your yard, the 1 through 5 and ABC combination would take shape of waves 1 and 2.

         

   From the above monthly chart of DAX (DE30), it started its rally from 2003 bottom from the lower level of 2190 and continues its rally testing the level of 8150 by year end 2007 December where it formed Double top and in 2008 Circes sharp correction was seen. This was the correction of the rally in the form of wave II and tested the lower level of 3590 which was exactly 76.4% retracement of wave I. after the correction we have again seen the upside move in the form of wave III and in this wave III there are inter wave where in inter wave also wave iii is near to completion. Inter wave I started from 3590 and tested the level of 7600 and from 7600 the correction what we have seen is the wave ii testing the support of 4965, which is 59% retracement of wave I, near to 161.8% retracement level. Wave iii testes the level of 10033 which was 121.8% retracement of wave i and confirming the reversal in the price are expected. Now if recent high of 10033 is holding will enter in wave iv of inter wave and it’s expected to test the level of 8028 which we expect 50% retracement of wave i and holding the high of wave i above 7600 and enter in wave v of inter wave III and completion of wave III can be seen at 12050 which is 100% retracement of wave I from the bottom of  wave II, which is expected in long run where.  

UK100 Indices Symmetrical triangle pattern. Target 6675

UK 100 Sell Below 6800 CMP 6830 Stop @ 6875 TGT 6725 - 6675

A Symmetrical Continuation Triangle (Bearish) is considered a bearish signal, indicating that the current downtrend may continue.

Description

A Symmetrical Continuation Triangle (Bearish) shows two converging trendlines, the lower one is ascending, the upper one is descending. The formation occurs because prices are reaching both lower highs and higher lows. The pattern will display two highs touching the upper (descending) trendline and two lows touching the lower (ascending) trendline. This pattern is confirmed when the price breaks out of the triangle formation to close below the lower (ascending) trendline.

Target Price

The target price provides an important indication about the potential price move that this pattern indicates. Consider whether the target price for this pattern is sufficient to provide adequate returns after your costs (such as commissions) have been taken into account. A good rule of thumb is that the target price must indicate a potential return of greater than 5% before a pattern should be considered useful. However you must consider the current price and the volume of shares you intend to trade. Also, check that the target price has not already been achieved.

UK100 is forming Symmetrical triangle pattern formation from the high of 6895 and support of 6771 and after it enter in the range bound, where it made lower top and higher bottom formation. It’s nearing the lower support level of 6800 and sustain below 6800 on closing basis it will give a confirmation of the breakdown of the triangle. Height of the triangle comes to 124 points (6895 - 6771) and calculation the target from the breakdown point of 6800(6800 - 124 = 1217) expected target comes to 6676$ in near to medium term. Below 6676 might go and test the previous bottom of 6550 – 6500 level.