Showing posts from November, 2016

MCX Aluminium to shed some recent gains

From the below chart of MCX Aluminium, it started its upward journey after forming a bottom in October 2015 and thereafter it is moving precisely in a rising channel formation, this gives an indication that the trend is positive. Moving averages are also showing positive action. However, prices have arrived near the resistance of the channel which can eventually lead to a short term reversal.
As per wave patterns, it is clearly visible that prices are as of now moving in a double correction (a-b-c-x-a-b-c). At current juncture it has completed or in a process to complete wave a of the second correction. Wave a can also exceed till 120 - 121 levels. Following there has to be a good reversal which will start wave b on the downside.
In short, expect prices to move down till 110 levels for short term. The major trend will continue to be positive as far as prices persist in the rising blue channel.

SBI: Head and Shoulder, Neo Triangle

SBI was forming a topping process from the month of August 2016 till November 2016. The topping process ended in a head and shoulder formation supported by volume. The left shoulder was accompanied by heavy volume but as the pattern started forming the volume receded. The level of 245- from where prices have bounced couple of times was breached, giving an indication the lower tops are in place. Short term moving averages have given a bearish crossover which supports my above mention view.
As per wave analysis, prices formed a extracting triangle at the top and then moved down thereby ending wave y at the top. One complex correction was ended from the bottom to top and now its correction will start on the downside.
As far as prices don't move above level of 256, the bias will remain negative for this banking stock. According to H&S pattern, prices can touch the level of 220.
SBI Daily Chart

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