Nifty entering in corrective mode...

 Nifty seems to be entering in a corrective mode.

As per Wave count it seems that we have completed 5 waves impulse nr 18700.

Considering speed at which nifty has gained this height I think next correction will take much longer as there need to be time spent at these levels.

Incase we are in correction then till march 2023 this phase is likely to last.

Significant fib levels for support are 16000, 14400, 13000 and 11750. This will bring it closer to 200 moving avg.

L&T at Fib Resistance

1650 level will act as resistance as it is critical fib level 

All stop loss hits All in Cash

All stop loss hits All in Cash you should be if you had stop losses.

So looking for clues I turn to Fibbonacci


In Nifty chart there are 2 scenario emerging.
One is the bull rally that ended on 8 Jan 2008 (6288 High) started
on 25 april 2003 when Nifty was 924 (I feel this is more convincing to ME)
and
Second thought is that rally started on 17 May 2004 when Nifty was 1338.

Now with 924 as start of rally we get following support levels can be arrived at
Delta = 6288 - 924 = 5364
High - 0.618 Delta = 6288 - (0.618 x 5364) = 2973 (Bot most level)
High - 0.5 Delta = 6288 - (0.5 x 5364) = 3606 (Mid level)
High - 0.382 Delta = 6288 - (0.328 x 5364) = 4239 (Top level)

While considering 1388 as start of rally we get
3260 (Bot most level)
3838 (Mid level)
4416 (Top level)

Fib level in M&M

Thanks to Linux, after long time I can now see my icicidirect's technical charts.

Well in this chart you can find the fibbonacci levels for the Mahindra and Mahindra. It has taken support at 690 level and again taken resistance at 810 level.

As there is already good buying support from 690 I feel it to act as good support and one can take long position with SL of 690.

Nifty Reacting

Asking Fibonacci :

Nifty have cracked the trend line as proposed earlier in http://learnthetrick.blogspot.com/2007/02/nifty-head-shoulder.html
If we consider that Nifty will react as per the short term impulse then the possible levels which
can be worked out as :
High : 4245
Low : 2595
Rise = High - Low = 1650,
Using Fibonacci ratios 0.38, 0.5, 0.618 you can have
1650 x 0.38 = 627 (L1)
1650 x 0.50 = 825 (L2)
1650 x 0.618 = 1019.7 (L3)

So now the levels are High - L1, High - L2, High - L3
Level 1 : 4245 - 627 = 3618
Level 2 : 4245 - 825 = 3420
Level 3 : 4245 - 1019.7 = 3225.3

Checking Charts:

Other option is to look for the even longer term trend line if it exist. Now below is the 3 year Nifty plotted on the log scale (For such a longer period I always prefer log scale it makes lot of sense).
Here there seems to be good channel forming.

Now this long term chart clearly states that if Nifty do not breach the bottom trend-line the Long term bullish out look stays intact. Hence 3200~3250 level becomes very critical.