RBI policy, Time cycles coincide as Nifty, Bank Nifty at crucial juncture

April 01, 2014
Bottom Line: RBI monetary policy, Daily Time cycle, 2 different Hourly Time cycles all are
coinciding together today. Closing will be crucial!
Nifty daily chart:
NSENIFTY (6,723.15, 6,730.05, 6,662.40, 6,704.20, +8.30029)
6800
6700
y
[X]
6500
Pc
6400
6300
(c)
vP
6600
6100
w
x
x
iii
6200
6100
6000
5900
5800
b
w
O
iv
5545
5700
5600
5500
Oy
5400
5300
5200
ii
cO
(w)
5100
5000
4900
Volume (177,579,424)
40000
30000
20000
10000
0
90
80
70
60
50
40
30
20
x10000
Money Flow Index (64.4076)
Dec
2013
Feb
Mar
Apr
www.wavesstrategy.com
helpdesk@wavesstrategy.com
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2014
Feb
Mar
Mob: +91 9920422202

Tel: +91 22 28831358
Apr
May
The Financial Waves Short term Update April 01, 2014

Nifty 60 mins chart:
NIFTY (6,684.85, 6,709.55, 6,684.60, 6,701.55, +17.35)
6750
6700
6650
6630
6600
6550
6500
6490
6450
6400
6400
6350
6300
6250
GAP
6200
b 6170
6170
x 6097
6150
6120
6080
6100
6050
6000
c
X
5950
Relative Strength Index (63.7058)
90
80
70
60
50
40
30
10
17
24
3
March
10
18
24
31
April
Wave Analysis:
In previous update we mentioned that Nevertheless, unless price confirms the trend continue to
be on upside. Break below 6570 will provide 1 st negative confirmation. Let us see if prices pay
heed to Time cycles both medium term and short term which are due this week or ignore them
and continue to move alone!
Indian equity markets continue to move in a very similar fashion. Prices had a Gap up opening which
got filled in first few hours. We mentioned importance of Gaps in previous update. Yesterday Nifty
had a range bound movement between 6730 and 6660. However, prices continued to protect the
lows of previous day and closed positive.
Market reaction to RBI policy will be crucial. Last time when RBI raised interest rates Nifty still
managed to close positive. As per 365 days Bond yield that tracks RBI actions and leads to some
extent is suggesting there will not be any increase in key policy rates. But the new RBI governor is
known for surprises and last time even the Bond traders were caught on wrong side. This time bond
yields have actually eased from near 9% to 8.88% indicating there should not be any rate hike.
One of the important patterns that indicate continuation of trend is formation of higher highs and
higher lows. From the lows of 6481 made on 22 nd March not a single bar has closed below previous
days low. From trading perspective this bar technique is very important. This is an anticipatory
trend following method and does not carry forecasting ability. It means that as long as prices
manage to close above the previous days low the trend will continue to be positive. So a close
below previous low of 6660 will indicate atleast a pause in current up move whereas move above
6730 will continue the trend on upside.
As shown on daily chart, 49 days daily Time cycle is due today. Along with this the hourly time cycle
shown on 60 mins chart is also due. Short term RSI continues to show loss of momentum in the move
post 6490. The internal structure of this move is also overlapping and well contained within the
channel which can probably be a wedge formation in wave c.
In short, the trend is positive as long as prices does not close below 6630 6650. Volatility can be
high based on above mentioned event and Time cycle today. Closing level will be crucial!
Mob: +91 9920422202
Tel: +91 22 28831358

Yes Bank Daily chart:
YESBANK (408.000, 416.750, 403.700, 413.950, +9.05002)
100.0%
550
500
61.8%
400
50.0%
e
B
387
350
38.2%
450
W
c
b
23.6%
3 4
300
c
X
250
0.0%
200
A
150
Money Flow Index (57.5848)
50
2013
2014
Mob: +91 9920422202

Tel: +91 22 28831358

Yes Bank 120 mins chart:
YESBANK-I (411.10, 417.80, 405.10, 416.40, +5.20)
E
c
550
500
450
W
c
0.0%
a
b
23.6%
387
a
38.2%
400
b 357
350
50.0%
61.8%
300
c
x
4
3
100.0%
250
5
A
200
2013 Jun
Jul
Aug
Sep
Oct
Nov
Dec
2014
80
70
60
50
40
30
20
Feb
Mar
Apr
Wave Analysis:
Nifty, Bank Nifty along with index based stocks continued its upside rally but important thing to
observe is that day by day upside momentum is decreasing and many of the stock has arrived at the
crucial levels. We have picked up Yes bank which is trading at crucial levels.
As shown in daily chart, prices bounced back from 300 levels in the start of March 2014 and
currently trading in the 400-420 zone from where it has reversed twice. As per wave perspective,
intermediate wave A completed at 220 in the month of September 2013 and since then wave c on
upside is ongoing. Prices have been trading in the complex Corrective pattern in form of (w-x-y) in
intermediate wave B. As of now short term trend is on upside, so one should trade accordingly.
We have shown Money Flow index which gauges volume participation in the ongoing trend. We can
see that, prices have are moving in the higher high pattern, however, this oscillator was unable to
move above the prior high and exhibits negative divergence. This indicates warning sign as of now,
but as long as we do not get negative price confirmation, trend remains positive.
As shown in 120 mins chart, within intermediate wave Y, price completed minor wave b at 357 and
moving higher in form of minor wave c. A strong move above 430 will suggest us to adopt the
alternative count which looks to be lower probable scenario as of now.
In short, the trend is positive with the support of 387. Break above 430 will increase the buying
pressure. However, any sharp move below 387 followed by 357 will indicate that next leg on
downside has started.
Mob: +91 9920422202

Tel: +91 22 28831358

Tata Motors Weekly chart:
TATAMOTORS (401.000, 404.150, 396.650, 398.650, +1.35001)
500
450
400
350
5
c
330
e
Y
250
300
200
150
100
Time Cycle of 95 Weeks

1
Semilog
50
90
80
70
60
50
40
30
20
2006
2007
2008
2009
2010
2011
2012
2013
Mob: +91 9920422202

Tel: +91 22 28831358
2014

Tata Motors 120 mins chart:
TATAMOTORS (398.35, 400.15, 397.00, 398.50, +0.15)
(w)
a
405
c
x
385
b
b
a
c
a
c
(x)
y
e
430
425
420
415
410
405
400
395
390
385
380
375
370
365
360
355
350
345
340
335
330
325
320
315
310
305
300
295
290
285
80
70
60
50
40
30
20
September
October
November
December
2014
February
March
April
Waves Analysis:
As shown in weekly chart of Tata Motors, from 2009 to start of 2011, stock showed impulsive move
on upside within 5 waves and completed major degree wave at the highs of 300. After that prices
continued to make a life time highs but the nature of the rally suggest that since 2011, the
movement is in complex corrective pattern in form of (W-X-Y-X-Z).
As per time perspective, the rally from 25 to 300 took 2 years and since then moving in the
correction which is now entering in the crucial year of 2014. As per Advanced Elliott wave concept,
if impulsive move has taken 2 years then following correction period should take at least 2 years or
more than that. Here, we can see the same that stock is following Elliott wave rules very well.
Hence, August 2014 is the period where 95 weeks time cycle is becoming due where stock should
complete its correction and then should start major trend on upside which will be impulsive in
nature. Before that few more months of consolidation cannot be ruled out.
As shown in 120 mins chart, recently prices bounced back from the level of 380 levels and moving
higher in small upward moving channel. As per wave perspective, minor wave b completed at 380
and starts to move higher in form of minor wave c. Now, on downside 385 will act as a strong
support.
In short, our favored view is positive with the support of 385. Any move above 405 will break
immediate resistance and move towards 420/425 is possible.
Mob: +91 9920422202

Tel: +91 22 28831358

Voltas Daily chart:
VOLTAS LTD (163.400, 164.200, 160.450, 161.000, -1.00000)
170
165
160
155
iii
150
145
140
iv
iv
135
iii
a or (i)
v
130
125
125
120
ii
115
iv
110
105
97
100
b or (ii)
95
90
ii
85
80
75
c O
70
65
e
v
H
60
55
80
70
60
50
40
30
20
2013
February March
April
May
June
July
August
September
November
2014
February March
Mob: +91 9920422202

Tel: +91 22 28831358
April
May

Voltas 120 mins chart:
VOLTAS-I (162.30, 162.80, 161.80, 162.30, +0.15)
165
160
155
153
iii
150
145
140
135
iv
a or (i)
v
130
125
120
iv
110
6
2014
13
105
a
S
30
115
ii
100
c
b or (ii)
H
20
27
95
3
10
February
17
24
3
10
March
80
70
60
50
40
30
20
18
24
31
April
Waves Analysis:
For Voltas in the last update dated 18 th March 2014, on downside 135 is the support. Any move
above 145 will take prices towards 153/155 where wave i = wave v.
We were accurate in predicting the up move of Voltas. In the last trading session, prices made a
high of 164.20. Now, after the sharp rally stock has arrived at the crucial levels.
As shown in daily chart, intermediate wave b or (ii) completed at 95 levels and since then moving
higher in form of intermediate wave c or (iii). Momentum indicator RSI shows negative divergence
which suggest that prices are in the matured stage of the up move. However, as of now we do not
have any negative confirmation and future price action will provide the clues for the same.
As shown in 120 mins chart, minor wave iv completed at 135 and moving higher in form of wave v
which is now equal to wave i. Close above 165 will continue the positive trend and will indicate
wave v is probably extending. This scenario is valid as long as 153 is intact on downside.
In short, trend is positive with the support of 153. Any close above 165 will suggest extension wave v
towards 170/173 levels.
Mob: +91 9920422202

Tel: +91 22 28831358

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RBI policy, Time cycles coincide as Nifty, Bank Nifty at crucial juncture

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April 01, 2014

Money Flow Index (64.4076)

Mob: +91 9920422202

The Financial Waves Short term Update April 01, 2014

The Financial Waves Short term Update April 01, 2014

Mob: +91 9920422202

The Financial Waves Short term Update April 01, 2014

Mob: +91 9920422202

The Financial Waves Short term Update April 01, 2014

Time Cycle of 95 Weeks

Relative Strength Index (59.0732)

Mob: +91 9920422202

The Financial Waves Short term Update April 01, 2014

Relative Strength Index (54.8237)

Mob: +91 9920422202

The Financial Waves Short term Update April 01, 2014

Relative Strength Index (73.0069)

Mob: +91 9920422202

The Financial Waves Short term Update April 01, 2014

Mob: +91 9920422202

The Financial Waves Short term Update April 01, 2014

Mob: +91 9920422202

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