Nifty Reaches 24,500 Target: Elliott Wave Analysis

13 Jul

Disclaimer:
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Trading in financial markets involves substantial risks. Consult your financial advisor before making decisions. This commentary is not a solicitation to buy or sell.

WaveTalks - Market Whispers: Can you hear them?
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General Election 2024: Impact on Nifty

The 2024 General Election resulted in a clear victory for the existing NDA government, with Prime Minister Narendra Modi securing a third term. This political stability had a positive impact on the Indian market index, Nifty.
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Pre-Exit Poll Movement

Before the election results were declared, we proposed an outlook for Nifty to reach 24,500 as a pre-exit poll objective. This prediction was published on TradingView as "Pre-Exit Poll Outlook - Bulls above 22,400 " on 31st May 2024.
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Achievement of Target

Following the election results, Nifty saw a significant rise from the lows of 21,281 on June 4, 2024, and successfully reached our proposed target of 24,500 on July 12, 2024. However, there was a knee-jerk reaction as the index failed to surpass the 400-seat mark announced during the election campaigns, leading to some volatility when the actual results were declared on June 4, 2024.
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Unfolding Structure: The Leading Diagonal

Since early March 2024, we have been discussing the potential for an explosive upside based on a leading diagonal pattern, also known as a Rising Wedge in traditional analysis. This Elliott wave pattern typically indicates a bullish trend, especially in the context of the 2024 General Election. We believed in the bullish scenario and termed it the "Leading Diagonal," expecting significant market movement.
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Why I Believe in Wave Analysis

As a Wave Analyst, my journey began with a curiosity about the market's patterns and behaviors. Eight years ago, in 2016, I started writing for TradingView and was given an opportunity to look into India Business for the brand during its early expansion years in India. On a personal front, I progressed to learn the nuances of wave analysis and started applying them to publicly traded liquid financial instruments. The results were astounding, providing 90-100% accuracy in the analysis. The science behind wave analysis is robust, but it does come with the limitation of alternate views if the price breaches the cardinal rules. More details on this will be discussed in my upcoming book on wave analysis (no ETA available at the moment).
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Pattern Analysis

Rising Wedge:
Often seen as bearish or bullish from a traditional technical analysis point of view, Elliott Wave analysis goes one step further by identifying the pattern's nature as bullish or bearish and can complement the unfolding events.
General Election 2024:
The election acted as a catalyst for the bullish trend.
Patience Rewarded:
Participants who held their positions since October 2023 are now reaping the benefits.

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Future Outlook

Key Psychological Level: 24,500

Nifty holding above the 24,500 level is crucial. If the index continues to bounce above this level, we anticipate the bull run to persist.

Target: 27,620

Our next target is 27,620, where the current rising wedge in Wave-1 should travel 162% of the minimum distance if this is to be Wave-3.
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Additional Insights

Reliance Long Term:

Nifty Explosive Series Episodes Starting Comex Copper:
These episodes as published on TradingView earlier, hinted at an explosive Nifty to unfold and how Dr. Copper’s move supported the outlook. This should be discussed as a different branch of technical analysis called Intermarket relations in my book, suggesting a strong bullish sentiment.

In conclusion, the political stability from the 2024 General Election has propelled Nifty into a strong bullish trend, with a key psychological level at 24,500 and a future target of 27,620.
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Regards From WaveTalks
Abhishek