Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
Will Biden’s Neo-Populist Economic Doctrine Support Gold? - 25th Sep 21
Markets Deflationary Winds Howling - 25th Sep 21
Crude Oil Price Piercing the Sky: Where Will We See the Black Gold by Xmas? - 25th Sep 21
Cryptocurrency policy choices and consequences - 25th Sep 21
The Next Emma Raducanu UK Tennis Star Pleasing the Crowds at Millhouses Park Sheffield - 25th Sep 21
Stock Market Rescued by the Fed Again? - 24th Sep 21
Are Amazon Best Cheap Memory Foam Mattresses Any good? Bedzonline £69 4ft Small Double ECO Example - 24th Sep 21
Evergrande not a Minsky Moment - 24th Sep 21
UK Energy Firms Scamming Customers Out of Their Best Fixed Rate Gas Tariffs - 23rd Sep 21
Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Should School Children be Jabbed with Pfizer Covid-19 Vaccine To Foster Herd Immunity? - UK - 23rd Sep 21
HOW TO SAVE MONEY ON CAR INSURANCE - 23rd Sep 21
Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
Trading Crude Oil ETFs in Foreign Currencies: What to Focus On - 22nd Sep 21
URGENT - Crypto-trader event - 'Bitcoin... back to $65,000?' - 22nd Sep 21
Stock Market Time to Buy the Dip? - 22nd Sep 21
US Dollar Bears Are Fresh Out of Honey Pots - 22nd Sep 21
MetaTrader 5 Features Every Trader Should Know - 22nd Sep 21
Evergrande China's Lehman's Moment, Tip of the Ice Berg in Financial Crisis 2.0 - 21st Sep 21
The Fed Is Playing The Biggest Game Of Chicken In History - 21st Sep 21
Focus on Stock Market Short-term Cycle - 21st Sep 21
Lands End Cornwall In VR360 - UK Holidays, Staycations - 21st Sep 21
Stock Market FOMO Hits September CRASH Brick Wall - Dow Trend Forecast 2021 Review - 20th Sep 21
Two Huge, Overlooked Drains on Global Silver Supplies - 20th Sep 21
Gold gets hammered but Copper fails to seize the moment - 20th Sep 21
New arms race and nuclear risks could spell End to the Asian Century - 20th Sep 21
Stock Market FOMO Hits September Brick Wall - Dow Trend Forecast 2021 Review - 19th Sep 21
Dow Forecasting Neural Nets, Crossing the Rubicon With Three High Risk Chinese Tech Stocks - 18th Sep 21
If Post-1971 Monetary System Is Bad, Why Isn’t Gold Higher? - 18th Sep 21
Stock Market Shaking Off the Taper Blues - 18th Sep 21
So... This Happened! One Crypto Goes From "Little-Known" -to- "Top 10" in 6 Weeks - 18th Sep 21
Why a Financial Markets "Panic" May Be Just Around the Corner - 18th Sep 21
An Update on the End of College… and a New Way to Profit - 16th Sep 21
What Kind of Support and Services Can Your Accountant Provide? Your Main Questions Answered - 16th Sep 21
Consistent performance makes waste a good place to buy stocks - 16th Sep 21
Dow Stock Market Trend Forecasting Neural Nets Pattern Recognition - 15th Sep 21
Eurozone Impact on Gold: The ECB and the Phantom Taper - 15th Sep 21
Fed To Taper into Weakening Economy - 15th Sep 21
Gold Miners: Last of the Summer Wine - 15th Sep 21
How does product development affect a company’s market value? - 15th Sep 21
Types of Investment Property to Become Familiar with - 15th Sep 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Indian Stocks: You Want a REAL Opportunity? Know WHEN to Look for It

Stock-Markets / India May 24, 2014 - 01:52 PM GMT

By: EWI

Stock-Markets

Why the Nifty and many other emerging market stocks screamed "Buy!" three months ago

From Elliott Wave International's February Asian-Pacific Financial Forecast (published Feb. 7):

...Bloomberg reports that "more than $7 billion flowed from ETFs investing in developing-nation assets in January, the most since the securities were created." Such massive selling...supports our view that emerging markets are ending large-degree three-wave declines.


Conventional observers are asking the question, "Is this 1997 all over again?" (The Economist)

The way we see it, the return of such headlines in January supports another significant low now -- from a contrarian perspective.

EWI's Asian-Pacific Short Term Update editor Chris Carolan soon echoed those bullish views. Here is a forecast the APSTU made for India's Nifty Index on March 4:

The strong short-term Nifty rally has pushed prices above their upper daily Keltner channel resistance level.

Look for this [rally] up to push through the 2014 highs at 6400 in coming sessions.

The intraday Keltner channel slope is steep, indicating this trend has enough strength for sharp short-term gains.

You've already picked up on the indicators we used to turn bullish on emerging markets in general, and on India in particular:

  1. A bottoming Elliott wave pattern - and a start of a strong Elliott wave rally
  2. A bearish market sentiment extreme towards Indian stocks, evident by the panicky headlines in January-February, plus big capital outflows from emerging market ETFs
  3. The fact that the Nifty broke above a key trend channel. See those two dotted lines in the chart above? That's the Keltner channel*, a very effective trend-defining tool.

As Indian stocks progressed higher, on March 9 Chris Carolan updated his bullish forecast and added this comment about India's upcoming elections:

Bloomberg reports that the Nifty's rise to new all-time highs on [March 7] occurred "amid speculation the opposition Bharatiya Janata Party is gaining support before general elections that start next month."

But from the perspective of the Wave Principle, the index's strong advance was a textbook bullish breakout in a third-of-a-third wave advance.

Volume hit its highest level in over a year. Momentum did as well, which suggests that the day's advance was part of a third wave. The weekly Keltner channel lies almost four percent above current levels, which also supports clear sailing in the short term.

Conventional analysts can rationalize the rally any way they want, but India's...bull market will continue no matter which party wins the elections.

By the end of March, Indian stocks shot up 10%.

Then in April, the Nifty added another 4.9%.

And just this week -- the week of the elections -- both the Nifty and the Sensex hit new all-time highs.

Now, Chris Carolan says this in the May 13 Asian-Pacific Short Term Update (partial wave labels shown):

The Nifty is up 6.7% in three trading sessions...

Risk management is a never-ending task. It's always a good idea to reduce exposure when markets move dramatically.

We have to remain prepared for any outcome.

Chris Carolan is a recipient of the Charles H. Dow Award from the Market Technicians Association. He has his own unique way of looking at European and Asian-Pacific markets that is beneficial for investors and traders alike. Chris will be hosting a free webinar on May 29 where he will share some of his insights into these markets. See below for more details.


Do You Want to Be Prepared to Capture New Trends?

Then join EWI's European and Asian-Pacific Short Term Update editor Chris Carolan, FREE, for a live webinar on May 29:

"3 Effective Tools for Navigating International Markets"

You will walk away knowing how you can use these 3 tools to forecast markets you invest in:

  1. Keltner channels
  2. Jurik RSX (a momentum indicator)
  3. And, of course, Elliott wave analysis

Go ahead, grab your free virtual seat at this May 29 webinar now.

Just tell us where to send your free access instructions >>

This article was syndicated by Elliott Wave International and was originally published under the headline Indian Stocks: You Want a REAL Opportunity? Know WHEN to Look for It. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

About the Publisher, Elliott Wave International
Founded in 1979 by Robert R. Prechter Jr., Elliott Wave International (EWI) is the world's largest market forecasting firm. Its staff of full-time analysts provides 24-hour-a-day market analysis to institutional and private investors around the world.

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in