NiftyMagican : Sunday Class summary of EW

[admin]

20 Jan 13, 11:34 PM
Nifty-Magician: Market moves in waves, each of which is interrelated to one another in time and price. A movement in a particular direction can be represented by "5" distinct waves of which three in the direction(called impulse wave-1,3,5) and two against the direction(called Corrective wave-2,4).
20 Jan 13, 11:35 PM
Nifty-Magician: At the reversal point, the first wave is formed with a swift retracement of the last fall Never miss the "Third wave entry"-one of the most rewarding phase
20 Jan 13, 11:35 PM
Nifty-Magician: Market moves in waves, each of which is interrelated to one another in time and price. A movement in a particular direction can be represented by "5" distinct waves of which three in the direction(called impulse wave-1,3,5) and two against the direction(called Corrective wave-2,4).
20 Jan 13, 11:36 PM
Nifty-Magician: a mere corrective wave, possibly time to BUY in with both hands. prices are rising in the fifth wave and you SELL the market when there is euphoria all around
20 Jan 13, 11:36 PM
Nifty-Magician: At the reversal point, the first wave is formed with a swift retracement of the last fall Never miss the "Third wave entry"-one of the most rewarding phase
20 Jan 13, 11:36 PM
Nifty-Magician: The 5 wave patterns are impulsive waves that cause the market to trend. The 3 wave patterns are corrective, and can be thought of as the market taking a breath so it can continue the trend. EW believes that these patterns are caused by group psychology and the interplay of fear and greed.
20 Jan 13, 11:37 PM
Nifty-Magician: An impulsive wave always subdivides into five waves (1-2-3-4-5)...Wave 1 usually subdivides into an impulse or seldom into a leading diagonal Wave 2 subidivides into a zigzag, flat or combination and sometimes single wave down wards. Wave- Wave 2 never moves beyond the start of wave 1 (Rule-1).trading point of views we can take 80% as stoploss. Wave 3 always moves beyond the end of wave 1 and is never the shortest (Rule-2).mostly if extnsion seen in 3rd wave in stocks and 5th extended in commodity. Wave 5 subidivides into an impulse or an ending diagonal Wave 4 subidivides into a zigzag, flat, triangle or combination,but some times time correction can aslo be there means price stable and not down with time travelled is equal to 2nd wave. Wave 4 never moves into the territory of wave 1 (
20 Jan 13, 11:37 PM
Nifty-Magician: Wave 1, 3 or 5 is usually extended, while wave 1 is the least commonly extended wave If wave 3 is extended, it’s common for sub wave 3 of 3 to extend as well (the same applies for wave 1 and 5). Subwave 3 of 3 almost always has the steepest slope within the parent impulse Wave 5 often ends when hitting a line drawn from the end of wave 1 or 3 that is parallel to a line drawn between the ends of waves 2 and 4. Wave 5 normally ends beyond the end of wave 3, if not it’s called a truncation If wave 2 was a sharp correction, wave 4 will almost always be a sideways correction and vice versa (Alternation. Normally A=C and 1=5 is basic
20 Jan 13, 11:37 PM
Nifty-Magician: If wave 2 was a sharp correction, wave 4 will almost always be a sideways correction and vice versa (Alternation) - Wave 2 is usually a zigzag or zigzag combination.- Wave 4 is ususally a flat, triangle or combination thereof Wave 4 usually ends within the price territory of the fourth wave of wave 3.- Wave 4 usually breaks the trendline. -4th wave can be traded on bothside. -one thing must be clear in mind that the basic impulsive wave is going up and 4th is corrective means halt in upmove and not the down move is on,so basic aim of ew trader is to use the 4th wave to re-enter in longs for the 5th wave.the entry can be made with the help on oversold indicators like rsi,macd and stoch. The 3rd always big and sharp inpulse so maany longs liquidated for profit booking as a wave and many shorts trapped in third wave so covering can lead to up move as b wave. Both fear and greed the basic two factors are always high in 4th wave.
20 Jan 13, 11:38 PM
Nifty-Magician: Impulse Trend : 1-2-3-4-5 Counter Trend : a b c

[kailash]

thanks NM sir