Tuesday, January 22, 2013

BSE Sensex Elliott Wave Count Long Term

On August 27th, i last posted a long term term chart based on a dollar adjusted proxy for the Sensex and although the count extended a bit it is still valid in addition to an (X) followed by an a-b-c. At that point the count on the BSE Sensex was still unclear. It seems like the Sensex has finally completed its move today topping at 20156.86, followed by 5 waves lower which should be the start of a major decline. This also supported by Bearish divergence in the RSI from Red A-C demonstrated with the red lines .
Any further upside movement specifically over the November 2010 highs (21079) will invalidate the count. So maintaining that the count stays valid we are presented with two possibilities.
i) Big downside: Green I & II are complete and  III, IV, V are pending with downside targets close to 11,000 or below.
ii) Lesser downside: A 5-3-5 correction of the 2009-2010 rally is still in progress which probably will take us down to 14,000