Charting with Elliott Waves & Technical AnalysisUnderstanding how to do Technical Analysis of any chart based on Elliott Waves
This analysis is for educational purposes only and should not be considered as trading advice. Multiple scenarios are possible in the real market, and there is a risk of being wrong. It is essential to consult with a financial advisor before making any trading or investment decisions. We are not responsible for any profits or losses incurred based on this analysis.
Wave Rules:
Wave 2 cannot retrace more than 100% of Wave 1.
Wave 3 is never the shortest wave.
Wave 4 should not overlap with Wave 1's price territory, except in diagonal triangles.
Applying Elliott Wave Theory
Elliott Wave Theory is a powerful tool for traders, but it requires practice and a deep understanding of market psychology. By analyzing wave patterns, degrees, and Fibonacci relationships, traders can gain insights into potential market trends and make informed trading decisions. It is important to combine Elliott Wave analysis with other technical indicators and risk management strategies to enhance the accuracy and reliability of market forecasts.
Elliott Wave Theory provides a comprehensive framework for understanding market cycles and predicting price movements. By mastering its principles and applying them with discipline, traders can enhance their ability to navigate the financial markets and capitalize on emerging trends.
Let's understand study of this chart
Elliott Wave Analysis:
The chart represents the Possible Elliott Wave counts for TATA STEEL, currently indicating the completion and projection of waves within an impulsive structure.
Wave Count Overview:
The chart demonstrates a five-wave impulsive structure labeled as:
Wave (i), Wave (ii), Wave (iii), Wave (iv), Wave (v)
The blue zone highlights a previous resistance area, which is now acting as a potential support zone.
The current wave structure projects wave (v) of ((v)).
Invalidation Level:
The nearest invalidation level for this wave count is at 155.00. A drop below this level would invalidate the current wave count.
Potential Targets:
The projected target for wave (v) of ((v)) is around level of 184.60 & more.
This target is derived from typical characteristics of the fifth wave in Elliott Wave Theory, often extending to new highs before the completion of the impulse wave.
Elliott Wave Principles and Characteristics of Wave (v):
Elliott Wave Theory posits that market prices move in repetitive cycles, consisting of five waves in the direction of the main trend (impulse waves) and three corrective waves.
Wave (v) in an impulse sequence is typically the final wave of the trend and often displays characteristics such as:
Completing the overall five-wave pattern.
Extending beyond the previous high of wave (iii).
Exhibiting momentum divergences (where price makes a new high but momentum indicators do not).
Sometimes driven by fundamental news or events, leading to sharp price movements.
Key Levels to Watch:
Current Price: 160.31
Nearest Invalidation Level: 155.00
Potential Target for Wave (v) of ((v)): 184.60
Educational Note:
Students of Elliott Wave Theory are encouraged to practice drawing their own wave counts and verifying whether all subdivisions align with higher-degree wave principles. This practice will enhance your study, making it more accurate and practical. Always remember, in real markets, multiple possibilities exist, and this analysis focuses on one potential scenario. There is a risk of being completely wrong.
I am not Sebi registered analyst.
My studies are for educational purpose only.
Please Consult your financial advisor before trading or investing.
I am not responsible for any kinds of your profits and your losses.
Most investors treat trading as a hobby because they have a full-time job doing something else.
However, If you treat trading like a business, it will pay you like a business.
If you treat like a hobby, hobbies don't pay, they cost you...!
Hope this post is helpful to community
Thanks
RK💕
Disclaimer and Risk Warning.
The analysis and discussion provided on in.tradingview.com is intended for educational purposes only and should not be relied upon for trading decisions. RK_Charts is not an investment adviser and the information provided here should not be taken as professional investment advice. Before buying or selling any investments, securities, or precious metals, it is recommended that you conduct your own due diligence. RK_Charts does not share in your profits and will not take responsibility for any losses you may incur. So Please Consult your financial advisor before trading or investing.
