A VERY BEARISH PICTURE

       

   
       This is my first post on Elliott waves and I think its a deadly one at that. The picture shows the Indian markets from the 2008 highs to the 2009 lows and then to the current 2015 highs. 

        The move from the march 2009 lows till date is a clear ABC ZigZag with a running contracting triangle as wave B. The contracting triangle is a large wave (50 months, from June 09 to August 13). Its as clear and crisp as can be and it satisfies all the guidelines of an Elliot triangle.

        According to Elliott, a triangle occurs either as wave B of a ABC move or as a fourth wave of a five wave impulse. What this implies is the triangle is the penultimate wave in a particular sequence of waves or more specifically put, the breakout following the triangle will be completely retraced. (and some maybe)

        In the current case of the nifty, five waves from the august 13 lows have been completed. This could then be a very important top that won't be taken out too soon.

        Digging deeper, assuming the 2008 fall is wave ((A)), then the move from March 2009 to March 2015 (if complete), forms wave ((B)), creating new all time highs. It then follows that the whole correction post the January 2008  high is either forming an expanded flat or a contracting/expanding triangle with wave ((C)) of the pattern due next. In case of the contracting triangle we would see a three wave move that falls short of the 2008 lows. Something in the range of 3000-4000 maybe. In case of the flat, we would see the 2008 lows being met or even crossed by a five wave downward move.

Expanded Flat

         Combining this pattern formation with the eight year cycle bottom due in Indian markets in 2016 (here),  this indeed is A VERY BEARISH PICTURE.  EXTENT WISE THIS BEAR MARKET COULD MATCH OR EVEN EXCEED THE 2008 BEAR MARKET.