Market Analysis With Megh Mody

USDINR is moving in a rising channel formation from past two years. As per wave analysis impulsive wave cannot move in a rising channel, so only one possibility of corrective pattern opens up which is double corrective or triple corrective pattern. The first corrective pattern which starts from May 2014, has a three wave structure of wave a followed by wave b in a running triangle pattern and wave c in an impulse. The prices then came down in three wave structure to complete wave x. The second corrective wave is again in a tree wave pattern followed by wave x and currently prices are moving in a third corrective which is a possible triangle. If this is a triple corrective pattern it can also be labelled as (w-x-y-x-z). Probable scenarios of triangle: Extracting triangle (ET): In a ET which has five legs in it (a-b-c-d-e), all the major upmoves in the triangle should be smaller than its preceding up move. As of now this rule applies to the current structure. For an ET to c

MCX Nat Gas is moving in a range of 142-145 levels from last two trading sessions as it awaits for its inventories schedule to release today. The previous reading was 68b but the consensus is 60b. Prices are moving in a higher high and higher low formation thus giving a clear indication that the trend is firmly positive. Prices also persist in a rising channel formation which supports the positive direction. The commodity is also trading above both the short term moving averages 20 EMA and 50 SMA, where there is a bullish crossover. From wave perspective, prices are moving higher in a double corrective pattern (as of now). I jumped to this conclusion as it is a channelized move and there can be a breakout of a triangle pattern today. The first wave a started from 109 and ended at 133.80 and wave b was completed in double correction (a-b-c-x-a-b-c) and completed at 126 levels. Wave c ended at 144 and wave x completed in a triangle pattern (a-b-c-d-e). As of now the second corr

Nifty from the low of 6825 in the month February 2016 surged till 7992 on the expiry of April 2016. The broader picture looks to be positive for broader markets but the corrections are always difficult to identify. In below chart, applying combination of basic technical tools and wave theory, it is clearly visible that prices might correct in near term. As per wave theory, one correction is over which might drag Indian equities lower in coming weeks. However, prices are continuously moving in a rising channel formation, break of this channel will open negative possibilities. Stay Ahead of major reversals and don't follow the crowd blindly. Lear Elliott and Neo Wave concepts in our next Webinar session scheduled on 21st and 22nd May 2016. For more queries mail me on meghmody@gmail.com Nifty Daily chart