NSE Britannia has formed a new cycle from 3050. Although the wave cycle is directional, it cannot be classified as an impulse structure. Impulsive waves have the following characteristics:
- Wave 3 never be the shortest wave among 1, 3, and 5.
- Wave 2 can never retrace 99% of wave 1.
- Wave 4 can never enter the price territory of wave 1.
- Waves 2 and 4 must show alternation in either price, time & pattern.
If the price does not follow these rules, traders must label the cycle as a correction. Take a look at the chart, and tell me if you think the structure is an impulse.
As per the chart, Britannia has accomplished the sub-wave B of wave (4) and started forming wave C.
If the price breaks down the low of wave c at 4314, Traders can sell for the following targets: . A trade should only be initiated after a breakdown has occurred.
There are two price clusters where prices can reverse:
- Wave C can be accomplished at 0.382 Fibonacci retracements of wave 3 at 4214.65. Wave A=C at 4187. As shown in the chart, it forms a cluster range.
- Wave C can occur at 0.5 Fibonacci retracements of wave 3 at 4114. Additionally, a correction occurs near the previous wave.
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