It is often a challenging task to identify and anticipate price action during periods of complex corrections. There are many times when the unfolding correction cannot be identified with Elliott wave theory or classical technical analysis. During such times we have been successfully able to identify corrections using Neo waves and anticipate the future path of prices.
In LIC housing finance we identified that a diametric pattern was in place and the next leg of the diametric pattern was to unfold on the downside. Also we made use of basic technical analysis where we were able to identify the resistance zone formed due to change in polarity of the broken channel.
Below is the chart with detailed analysis published in our daily report- “The Financial Waves short term update”
LIC Housing Finance 60 mins chart: (Anticipated as on 13th September)
LIC Housing Finance 60 mins chart: (Happened as on 9th Oct) made lifetime low of 362.60
Anticipated as on 13th September – As shown on the hourly chart the prices are retesting the channel. We have shown the internal counts wherein we might be moving in the form of a diametric pattern and d leg is ongoing. However if prices break below the 388 level we can assume that the wave d is over and wave e is starting lower.
The diametric pattern is a very common pattern that we observe more often on the charts. A Diametric is a seven-legged corrective pattern and is labeled as A-B-C-D-E-F-G. Important characteristic of a diametric pattern is that wave E tends towards equality with wave C in terms of price and/or time, wave F tends towards equality with wave B and wave G tends towards equality with wave A
In short LICHSGFIN seems to be placed at a crucial juncture with negative bias. The resistance placed at 420 and the support placed at 388. Any move below 388 will result into a trending move towards 365 or lower.
Happened as on 09th October – Prices moved exactly as expected and post re-testing the channel; the stock broke its important support of 388 on closing basis & moved lower to form another 52 weeks low near 362.20 levels in today’s session.
We cannot be more accurate than this. The above research shows how well Neo waves work and how different tools could help in deriving the exact entry points and targets for the same. Get access to the daily equity research report & capture good trading opportunity over short term “The Financial Waves short term update”- Get access here
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