long term charts for nifty, sensex and dow jones...

dow jones monthly chart.



sensex monthly chart.



nifty monthly chart.

intermediate bounces will be resisted by upper falling resistance trendlines.



abhay r somkuwar.

how low can it get...

bear mkt is in full swing and seems like final capitulation is coming in.

how low can the index go to?

putting a number is very difficult to such a downside as lvls come and go and mkt falls further down.

the trend is strongly down and it makes no sense to go long or buy stocks immediately for investment even though they appear too cheap, let the mkts settle down and make a bottom and show real signs of moving up, even if one invests at these lvls will have to wait for long time 1-2 years for next bull mkt to start.

we had already discussed the worst case scenario.

but lets see how bad it can get.

elliott wave theory says bear mkts typically end near top of the first wave of previous bull mkt.

that lvl comes to 2014 on nifty and 6250 on sensex.

previous bear mkts had a drop of 60-65% from the previous bull mkt highs.

that means current one might correct to between 2221 to 2540.

since jan the nifty moved in fashion 6357-4448-5300-3790-4650-2700, every rise was approx 50% of drop and each big drop was approx 30% from its recent high, e.g 6357-6357x0.30=6357-1907=4450,5300-5300x0.30=3710, so drop from 4650 was expected upto 3255 but nifty continues to fall giving indication this may end up 50-60% or so which is 1860-2325.

my p/e chart had p/e data only for low of 10.84, bear mkts had earlier traded at a low p/e 9-10, current eps gives such a lvl 2300 unless the earnings take a hit.

its not necessary mkt will go down there, but who knows?

just as it is difficult to call mkt tops so are the bottoms. bull mkts end on euphoria and bear mkts end when pessimism is at its peak.

update on my ew analysis..

looking at the ew chart of nifty, the pullback upto 3648 seems like C-3-(4), it was tentatively marked so on given ew chart, it also falls within the given time period till mid of this week as stated in last weeks ew post.

in all probability, on weak global cues nifty will open gap down and hence C-3-(5) will progress which will create more positive divergence on rsi, at the end of C-3-(5), our tradeable bounce i.e., C-4 will begin.

likely tgt for current short term downtrend i.e., C-3-(5) is coming at 2870(tentative).

our nifty bottom poll ends today, most readers/visitors of this blog were aware that mkt hasn't formed the bottom yet.

***ew analysis is speculative in nature, readers advised to follow own discretion.

play it both ways...

fun intended!:)

the rising wedge...

so after the falling wedge on eod charts, today it was the turn of the sort of rising wedge on intraday charts of nifty.

congrats to anyone who traded it bcoz the perfect tgt was reached near previous nifty low near 3050.

the falling wedge and my ew chart...

here's the much discussed falling wedge now developing on nifty chart, the volumes are declining and positive divergence showing on rsi indicator. it needs a bullish breakout with volume above the wedge upper tline, the upper tgt after a break out will be upto 3600. this if happens will probably mean our C-3-(4) and C-3-(5) completed and C-4 will be on with already given tgt that matches very well.

but a close with volume below recent low of 3047 and further will negate this. and the wedge/triangle then i will perhaps mark just as C-3-(4), as it fits in time reqd for its completion, with further waves C-3-(5) etc to follow thereafter.

pls refer to my ew chart posted earlier for reference.

so it seems the movement of nifty in next couple of days will be interesting and will provide the direction to trade.

fresh nifty pe chart...

peta(pun not intended) chart analysis is something unique to my blog as described by many friends trading and analyzing mkts.

immediate support lvl by fibo seen near 12.62 p/e equivalent to 2950 on nifty. upperside if re-enters channel it will be likely to be resisted by the upper trend channel lines currently near 14 and 18 p/e respectively.

max projected downside if remains below trend channel is about 10 p/e or 2340 on nifty(its not necessary that it will get there).