Astro Technicals

Wednesday, August 31, 2016

Dollar Index-USD INR & Gold

Dollar Index has been undergoing a prolonged correction since 2001.It had formed a triangular pattern at the point marked as E and then broke out strongly. Since March 2015, it had entered into a sideways move, by way of a complex correction. Either the move out of E is the next leg of a diametric formation as F and currently we are in the last leg G of the prolonged correction from 2001.Or the move out of point E is the start of a new impulse 1 and we are in wave 2 right now. Any way the complex correction has some more downside left..
See the expanded chart...

We see the complex correction clearly here. Also when Fed raised interest rates, contrary to classical thinking, Dollar did not strengthen. It actually depreciated.Probably the markets are not likely convinced about the Fed analysis of the economy strengthening. Indicators point out that the economy has been strengthening only feebly and is still prone to sudden shocks.The complex corrective wave of G or 2 has been going on for a year now and may end soon after the elections.Then dollar could enter into a new impulse or wave 3 of an existing impulse. That could see sustained dollar strength probably next year.
Next chart is of International Gold...

We see that when Dollar depreciated from 2001 , Gold was in a sustained bull run exhausting itself on September 09, 2011 (09/11 ! ) the same time Dollar bottomed out.After that Gold had a correction from 1900 levels to 1050 levels as wave A. Since the rise of Gold was sustained, we surmise that Gold correction is not yet over. So the recovery from 1050 levels is wave B.It is still on going.We see the nature of B wave in the recovery of Gold..hesitant and overlapping. In an isolated view Gold may seem to be in a bull market, but definitely wave C down has to come to end this correction of Gold.

That could very well coincide with a sustained Dollar rise, since they inversely correlate.

This chart is that of USD INR..

Dollar bottomed out against the rupee in 2008 and since then has been on an impulsive rise.Currently it is in wave 4 of wave 3. Wave 3 seemed to have topped out somewhere in the 68.80 range and since then rupee has been appreciating.In fact it was in the week of Feb 26, coinciding with a Stock market bottom. Thereafter the rupee appreciation is coinciding with FII money coming into India.Since the 4th wave is ongoing more fund flow into emerging markets may happen.Market top next year may likely coincide with FII withdrawal as well. I would look at dates in Feb March 2017 for such an event.
Last chart is of Gold in rupee terms.. Iam re-posting this since it is easier to compare in one post,

Here the same pattern similar to International Gold may be observed. Only thing is the correction is a lot shallower...That is because we Indians love our Gold and anytime Gold falls we rush to buy.But the time cycles cannot be denied.Gold in India also has to decline maybe a little lesser than International Gold, but decline it may.
This is my gleanings of the immediate term and medium term trends in Gold, USD INR and Dollar. Of course I may be totally wrong and that would only give me more learning opportunities.
I do not trade any of these instruments. My interest is solely that of a research student.

Tuesday, August 30, 2016

Gold Update August 30, 2016

Reliance Update August 30, 2016

Both wave wise and Angles wise, Reliance is in an interesting place now.

Nifty Wave Counts August 30 Update

Since March 2015, Nifty has been forming a series of complex corrective waves, which are now grouped majorly as ABCD and E.Right now we are in wave D. Wave D is already bigger than wave B. This means wave E could be a shallower affair than if it were the last leg of an expanding triangle. It will be a variance of a Neutral triangle with possibilities of E wave failing.This had started from 6825. Formed five internal waves, abcde. Corrective down move was Brexit event.Since the market recovered, we started one more abcde combination. Connecting the first set of waves with the latest ones in the x wave.In a complex corrective, there can be a maximum of 2 x waves.
Currently we have completed wave d and are in wave e upwards.
Once this wave e is completed. then Nifty can do two things.
1.Come back to the 0-x line form a bottom and reverse upwards into yet another abcde or even diametric formation. That could immediately take Nifty very high. For that to happen, Nifty must break out of 8750.
2.Or fall from wave e, break the 0-x line and travel down swiftly, taking out the last up move in faster time. Then we will be in wave E downwards,which can go all the way to 8000.
For that Nifty should take out 8543 convincingly on its way down.
I had posted this chart, since we are at an important inflexion point.