The Nifty 50 completed a 3-wave correction from its most recent all-time high. We expect another brief spike into the 12,200-12,400 area before the wheels come off.
Indian equities have lost steam recently. Their rally continuation occurred on diverging momentum. This observation hints towards a nearby fade. However, the upside pattern is most likely still incomplete at the time of this write-up. Another brief up sequence completes the c-wave of minute degree within an ending diagonal. Subsequently, the most significant correction since 2016 is likely to unfold. It will be the c-wave of an irregular flat pattern. The flat’s degree is unclear. It could be of an intermediate or primary degree. Whatever it is, it will result in another 20% leg down.
All in all, the Nifty 50 has probably one more spike to the upside left before the next big move to the downside commences.