Sensex Comprehensive update
The reason I have chosen Sensex to Nifty for this update is that we have the data for Sensex dating back to 1979. This update is purely based on Elliott wave theory since there is quite a bit of interest shown by our fellow members towards EWT.
Monthly chart of Sensex(1979-2014) is seen above. As we see, super cycle wave 1 started in 1979 and ended in 2008 spanning 29 years , followed by SC wave 2 which corrected 61.8 % and spanned for just 10 months. Subsequently, Cycle wave 1 started in 2008 and ended in 2010 spanning 2 years, followed by Cycle wave 2 correction of a little over 38.2 % spanning a year. Since December 2011 we have seen Cycle wave 3 subdividing and this has led to alot of ambiguity among many analysts and theorists whether the same is a corrective wave or the beginning of a new impulse.
Lets take a closer look at the weekly chart of Sensex. As you can see, I've made a tentative labeling of the impulses and corrections. The perception I get from analysing the weekly chart is that Cycle wave 3 is subdividing and that currently we are in Major 3 of Primary 3 of Cycle 3 of super cycle 3( this wave is the strongest of all the impulses ). Once Major 3 completes, we would then be left with 2 corrections and 2 impulses to complete Cycle 3 wave. Cycle 3 wave has a minimum price objective of 28500 (Sensex) and 8600 ( Nifty ). Cycle wave 1 took 2 years to complete but it is already 2 years up since Cycle wave 3 started and is still subdividing. Its only a matter of time for the price to catch up with the time. Lets see if market has something else in store
Finally coming to the daily chart. You can again see here how major 3 is further subdividing. We are in minute 3 of minor 3 with 2 corrections and 2 impulses left to complete major 3. Major 3 has a minimum price objective of 24500( Sensex ) and 7350 ( Nifty ).
Indian stock market has only flattered to deceive in the past and hope its not the same again. As long as Nifty consistently holds and close above its previous significant peak of 6338, we should see a prolonged multi decade bull market going forward.
All the best to your trading and investing !
PraDa