Larsen and Toubro Elliott Wave Counts and the forthcoming trend

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Larsen and Toubro is a capital good stock which has gained tremendously in past 2 weeks. However, this stock witnessed profit booking from last 4 trading sessions. It is difficult for many investors and traders to know when to buy and when to sell?

By using perfect technical tools and combining it with advance technical analysis, it will be easy not only for investors, traders but also for learners. By saying perfect technical tools is by using channels, channels always help to identify resistance and support levels, while advance technicals like Elliott wave analysis helps you to understand the forthcoming trend.

We have applied it on Daily chart on Larsen and Toubro


Analysis
As shown in the daily chart, the stock started moving lower after making high of 1154 on 9th December 2013. It fell so steeply that currently it has arrived near the support of the blue channel. The overall trend remains negative but we will be more bearish after it breaches ….. level.

As seen in 60 mins chart, prices are moving precisely in an upward sloping blue channel. It is not advisable to initiate fresh shorts at this juncture but to wait for bearish breakout. A move below ……will give bearish break in rising channel formation. However, RSI on smaller time frame has arrived near 30 levels which is very important support as it has previously reversed from there (marked by blue arrows).

From wave perspective, …………………………………………………………………………………….

In short, a move below ….. will open further negative possibilities. However, move above ….. will infuse buying pressure.

It is better to think objectively before initiating any trades.

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