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Basic Tenets:
Elliott waves are famous for finding crowd behavior trends and reverses in recognizable patterns. Elliott’s wave principle is inspired and made from the Dow theory, which is the foundation of the technical analysis.

Elliott’s wave principle consists of eight waves.
In this eight wave, price forms two types of wave structure,

1. Motive structure:
– Five Wave Pattern.
– Moves with the primary/main trend.
– Labeled in Numerical method (1,2,3,4,5).

2. Corrective structure
– Three Wave Pattern.
– Moves against the primary/main trend.
– Denoted in alphabetical method (A, B, C).

Now, let’s look at the 2-day chart of 3MINDIA.

Timeframe: 2 day
Price has accomplished the impulsive wave (3) and started forming corrective wave (4) by breaking sub-wave iv of wave 5 of wave (3).
Currently, the price is in corrective mode.

Sub-wave 5 of wave (3) has ceased, the terminating wave v of ending diagonal. Price has broken down the corrective wave iv at, 22590, which signals bearish sentiments. After breaking the main channel, the price started falling sharply.

Calculation of wave (4):
The common retracement of wave 4 is 38.2% of wave 3.
Wave 4 can never retrace more than 61.8% of wave 3.
Wave 4 occurred near sub-wave 4 of lower degree.

Timeframe chart: 4-hour

Price has broken down the sub-wave iv of the ending diagonal of wave 5.
After the pullback, if the price sustains below, 22590, it is likely to give a big move below the parallel channel.

Traders can initiate a short position for the following targets of 21010-20557.

Invalidation and entry are available for only premium subscribers.

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PEL: PIRIMAL ENTERPRISE

Before:

PEL has formed a double three corrective structure. Price had completed wave B of complex correction W-X-Y.

As the price formed in the downward channel and the Y wave was to cease, the price had bearish sentiments.

I had mentioned in clear words,” Traders can initiate short positions for the following targets: 2400 – 2376 – 2301 – 2279.”

After:

8 February:

Price reached the first target of 2400 and made a low of 2996.

14 February:

Price reached the 2nd target at 2376.

Price reached the 3rd target at 2301.

Price reached the 4th target at 2279.

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GPIL: Godawari Power

Before:

PEL has formed a downward corrective structure. Price was at the upper band of the parallel channel.

The upper-band indicates supply pressure where sellers exceed buyers.

The price has provided two successful rejections from the upper band.

GPIL had bearish the sentiments.

I had mentioned in clear words,” The trader can initiate a short position for the following targets: 313 – 304 – 290.”

After:

At the upper band, the price couldn’t break the upper band of the parallel channel.

14 February: GPIL reached the First target of 313.

15 February: GPIL reached the second target of 304.

What’s next?

Price is at the lower band of the parallel channel. And if the price breaks down the minor parallel channel, it can travel up to the control line of the downward channel.