Old Analysis (29/1/2015) - NSE Nifty mapped to USD/JPY

In my last post, i had posted the Elliott wave counts of USD/JPY currency pair. The reason to take up USD/JPY as the first for analysis was that I consider it to be a key chart which maps either directly or inversely with several other markets. The one market where I find the correlation quite uncanny is the NSE Nifty.

Before I proceed, I would like to say that the wave count as shown by me for USD/JPY, is not the only count possible. In fact it is quite a far fetched count at this stage. But I have reasons to believe in this wave count till proven otherwise. The main reason for this count is the occurrence of triangles, first from May to Sep 2013 and now recently from Nov 2014 to Jan 2015.  

Now on to NSE Nifty as it maps to USD/JPY. 

 

The chart is self explanatory. However a couple of points for consideration are

• The charts are mapped from October 2011 onwards
• The tops in NSE Nifty correspond very well with the tops in USD/JPY
• However the bottoms in NSE Nifty and USD/JPY don't exactly match. It can be seen that USD/JPY is making a bottom after the NSE Nifty has already formed a bottom and has started on the next leg up.
• The only time USD/JPY led the bottom formation was at the start of its upmove. The USD/JPY made a bottom in October 2011, followed by a bottom made by NSE Nifty in December 2011. 

Conclusion

 If the previous analysis of USD/JPY works out as projected that would mean that the last up leg of the USD/JPY is about to start/ started. By that token, if NSE Nifty continues to map with USD/JPY, it has also started it's last leg up. Going forward any five wave completion of up move (time frame - daily) in NSE Nifty should be a selling point. The next down turn may be volatile, if USD/JPY is indeed undergoing an extended 5th wave.. If the correction shows that the bull market is still in-tact then new positions may be taken.