Diametric pattern – Understanding Nifty medium term pattern by applying the concept of Advanced Elliott wave – Neo wave theory to forecast the next trend.

For successful trading it is very important to understand the overall price pattern. Unless the pattern is clear it is best to avoid the trade.

Below shows how a text book Neo wave Diametric pattern markets are exhibiting

We are closely keeping on tab on Nifty’s price structure along with time taken by each segment to know the pattern under formation. This helps us in forming different strategies so as to leverage from ongoing pattern.

For option traders it is most important to know that whether current trend is going to be sharp or will it take more time to move higher?

Below is the part of research taken from “The Financial Waves Short Term Update” which indicates that there is high probability of Nifty forming Diametric pattern which is 7 legged pattern defined under Neo wave.

Nifty daily chart Diametric pattern:


Wave analysis:

Nifty has closed below the immediate support of 10700 on downside and serious selloff has been seen in stocks from Midcap and Smallcap space.

It is very important for you to understand the overall pattern under formation so that atleast you are aware that prices are near the cusp. Few days back we published an article mentioning that Is Nifty top in place again! You can read it here

As shown on daily chart, prices are forming a Diametric pattern. This pattern is recognised in Neo wave as a 7 legged correction and can take a form of either Bow- Tie structure or a Diamond shaped structure. In the above chart we can see a Diamond shaped Diametric pattern.

Each legs are corrective and we are currently in wave g. As of now it is too early to conclude that the entire wave g is over and a major top is formed but it definitely indicates that 2018 is not going to be the market for investors. However, for traders there will be ample opportunity as volatility is going to be high providing big swings. To encash the next big trend on markets you need to combine this Neo wave pattern with Time cycles.

It is not a 100% accurate theory. There are times when things get challenging but when the pattern is near completion we get a very high conviction trade setup just before the big move can happen.

Trust me there will be many trades where you will gain and lose little but only a few big trades will make up for all the hard work and efforts that are put in.

So what is the next big trend and how to capitalize on the ongoing move?

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