Nifty – Markets are in the process of completing an expanded triangle, where the last leg of wave “e” is on. The culmination of this triangle will mark the completion of the ABC correction and most likely the bottom formation. (Can test the upper boundary of the triangle also before reversing down)
Wave “e” of an expanded triangle can by itself end in a triangle, besides culminating prematurely OR shooting past the lower boundary. Wave E is typically marked by high volumes especially when overshooting the lower boundary.
In case we end the correction in this way, it will mark the end of wave IV and wave V should start upwards.
A SMALL NOTE BELOW ON NIFTY EXPANDED TRIANGLES REG VOLUMES AND BREAKOUT
According to Elliot Wave Theory, an expanded triangle is a pattern that occurs in financial markets and is characterized by a series of increasingly wide price swings. An expanded triangle can be identified by a pattern of five waves, labeled A, B, C, D, and E. Waves A, B, C, and D form a shape that resembles a triangle, while wave E MAY extend beyond the boundaries of the triangle.
In Elliot Wave Theory, the last leg of an expanded triangle (wave E) can indeed finish abruptly also. The final wave E is often characterized by a sharp and sudden price movement that breaks out of the triangle formation. This breakout can occur in either direction and is typically accompanied by high trading volume.
It has been my personal observation that when wave “d” is large in proportion to wave “c”, chances of wave “e” finishing abruptly increase somewhere along an imaginary middle line of the triangle.