Happy Samvat 2075 - with 2075 Market Insights

Published: Wed, 11/07/18

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THE NEW BEGINNING

Wishing all of you a New Beginning with Samvat 2075 - A Happy and Prosperous New Year

The market pushes you back two steps when it is time to introspect. The last year has been a great one to take note that strategies that were being pushed to you for the last few years suddenly fell on their face.

The strategists might still not agree. The road to prosperity is filled with peril they say. Once you take note of your gift it gets easier and you feel more contended. If the year gone by has opened you up to the idea that the narrative has changed then my economic updates and long term Elliott Wave perspective has been offering an alternate view of the world for a while. As every year goes by I have become more, and not less, confident of that view.

The real question is have you crossed that line and if yes then it is time to work upon the right strategy for you going forward. I am clear that the economic winter is now percolating down to the stock market bubble that has has been pricked. For that reason my elliott wave counts on the chart below differ with the rest of the street. I am still to see someone mark it this way. Most are hoping that it is a wave 4 correction we are in and new all time highs are coming. This despite the steep setback in stocks and broad market indices that have broken 3-5 year trendlines. The end results can be very different, in fact they already are. Long term investors that did not heed the finer points of this are already licking their wounds. And Hope is not a strategy.

So let me leave you with some hints on the Macro trends that are unfolding that I write about everyday. But to stitch it all together I write the detailed Long Short report and this months piece is out.

Crude

With Oil below 64 and the RSI at 27 it is now getting oversold. Late in wave v down we should be concerned about being bearish near term. the next trend reversal will start a move up in wave 2 up for crude, a steep retracement of the losses is possible. A retest of 70$ is not ruled out.

crude 021118

USDINR

USDINR - completed its pullback to the 40dema. Now it did close below it for a day in panic but yesterday it is back above it. So this maybe a false break. a-b-c done we can argue wave 4 is complete unless wave 4 wants to keep meandering to form a triangle. Even then the low has been made because a triangle is a consolidation that involves a contraction of the highs and lows. The immediate resistance is 73.59 at the 20dma. If wave 5 has already started we head to 75 else the upper end of the falling channel near 74 may serve as a key resistance.

usdinr 061118

Dollar Index

The dollar index is forming an expanded flat pattern marked as A-B-C where B goes above the high of wave A and B is not larger than 138.2% of A usually. Then wave C will retest the low of wave A that is at 93.40 or C=A*161.8 = 91.40. Unless something changes this is the perspective that Elliott Wave analysis gives.

dxy 061118

US 30 year bonds

The US bond market rose in 3 waves in the blue small channel and broke down. So the larger trend remains down. The recent bounce is wave II of 3 down, and the next wave is III of 3 down. III=I goes to 130.40 from 137.50 currently. This points to new highs in the 30 year bond yields or higher interest rates being indicated in the coming weeks. With the daily weekly and monthly momentum in sell mode this part is clear.

bonds 061118

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Rohit Srivastava
www.indiacharts.com
For accurate market forecasting. Market forecasting is a study of past data to assess
future probable outcomes. It is our endeavor to discuss high probability outcomes for
traders and investors. However this is not a solicitation to buy or sell stocks futures or
options or any security. Trading in any financial market should be done with sound
knowledge and the help of a qualified investment adviser. Stocks based on the Elliott
wave model are based on the Fibonacci fractal of the market and momentum indicators,
targets are based on Fibonacci maths and are only indicative of what the mathematical
model throws up. This is not a recommendation to buy/sell.
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