correction.
on 9th august, a black closing Marubozu formed. that indicated that sellers controlled the price action from the first trade to the last trade although on a small volume. The day opened and prices went slightly higher, forming an upper shadow. Then prices reversed direction moving below the opening level, and the decline continues all day ending with a closing price equal to the low of the day. The bears were very strong during that day except during the initial phase of the session.

on 10th august, a hammer formed. The price opened and started to trade lower. The bears were still in control. The bulls then stepped in. They started to bring the price back up towards the top of the trading range on high volume. This created a small body with a large lower shadow. This represents that the bears could not maintain control. The long lower shadow now has the bears questioning whether the decline is still intact. A higher open on 11th August would confirm that the bulls have taken control.

@mufasa, "Am I correct to assume that wave three is not always the longest and the bear that follows wave five will settle around the region of wave four lows and not anywhere lower."
that is correct
"Looking at the chart, point B of 2012 is actually the lowest point of wave 4 that began in 2009 and as such we are now experiencing the last of wave 5."
in my humble opinion, the high of 2007(point A in blue) marked the last bull impulse wave and probably wave 5. This means since the the market has been correcting. If that is the case, the low of late 2002 formed wave 4. So if "bear that follows wave five will settle around the region of wave four lows and not anywhere lower", then bear might continue lower to sub 2000 points although there are 2 structures/obstacles on the way that might hold a little or act as support. there is nothing certain with financial markets. but at least we have an expectation

The fact of the NSE 20 Share index gropping for below 3830 gives me confidence that the bear market in stocks is here to stay and will likely get worse. It should be awakening call for most.



The NSE 20 Share Index started its journey in 1966 at 100. The data available to me on the index is as shown in the chart above from ft.com. The most important thing is that the data fits perfectly into Elliott Waves as they should (after all we are tracking mass human psychology). From this we can proceed to 'predict' the future!

Wave (A) ended at 2360.01 in Mar', 2009.
Wave (B) ended at 5499.64 in Mar', 2015.
The preferred Elliott count suggests that the fall from the 5499.64 level is a wave (C) which has much further to drop.

We can target the final low for the NSE 20 share index which I expect to occur probably in 2017.

Assuming that the movement from 100 to the ultimate high of 6161.46 (on Jan', 2007) is one major Impulse wave, then the waves (A), (B) and (C) are its correction (a wave two). Second waves usually retrace a Fibonacci 61.8 or 78.6% of wave one. Thus:

{6161.46 -( 0.618 X (6161.46 - 100))} = 2415.48

And

{6161.46 - ( 0.786 X (6161 - 100))} = 1397.15


Also, if wave (C) be equal to wave (A) then:

Wave (C) bottom = { 5499.64 - (6161.46-2360.01) } = 1698.19

So targets for wave (C) and thus the ultimate bottom for the NSE 20 Share Index are 2415.48, 1698.19 or 1397.15.

The alternate scenario is that wave (B) is not complete and thus a move above 5499.64 is in the cards. I give this scenario a low probability since the proposed wave (B) would appear too stretched.

Analysis of the shorter term will show in these pages soon.

#BEST.

Crickets here

ICDC
could this be a bullish butterfly in the making. your comments and opinions highly appreciated

centum broke below the up trendline at 42.50 today. This is a bearish sign. This up trendline, currently with an ending point at 43.28, may now provide upside resistance. Volume on the day of the breakout was quite heavy--75% above average. This makes the breakout even more significant.