The TASI INDEX daily chart analysis shows a counter-trend correction forming within a broader bullish structure. The index has completed the Orange Wave 1 advance and has started the Orange Wave 2 correction inside the larger Navy Blue Wave 1 uptrend. This setup signals a temporary downward move before a potential return to the main upward trend.

Orange Wave 2 marks the corrective phase, typically retracing between 38% to 61% of Wave 1's gains. It often forms common corrective structures like zigzags or flats. The end of the strong upward move in Wave 1 sets the stage for this pullback, usually marked by overlapping price action and reduced momentum. The daily chart suggests this correction could be an intermediate pause within a larger bullish pattern.

The next likely move will be Orange Wave 3 advancing upward after the Orange Wave 2 correction finishes. Wave 3 is usually the strongest phase, potentially pushing well beyond the peak of Wave 1. Traders must closely watch the 10657 level, as a break below it would invalidate the current wave interpretation.

Market participants should track the progress of Wave 2 for classic end-of-correction signals, such as bullish candlestick reversals or momentum indicators reaching oversold levels. This correction offers strategic opportunities to prepare for the next bullish move in Wave 3. Using technical analysis will be crucial to confirm when Wave 2 finishes and Wave 3 starts.

This corrective phase is a normal and healthy consolidation within the larger uptrend, giving traders a chance to position early for a possible upward continuation. Observing price action, especially around key Fibonacci retracement levels, will be important for timing entries as the market shifts from Wave 2 to Wave 3. The daily timeframe highlights how critical this development is within the broader bullish outlook.

TASI Index Wave technical analysis

Function: Bullish Trend.

Mode: Impulsive.

Structure: Navy Blue Wave 1.

Position: Gray Wave 3.

Direction next lower degrees: Navy Blue Wave 2.

Details: Gray Wave 2 appears completed; Navy Blue Wave 1 of 3 now in play.

Wave cancel invalid level: 10657.

The TASI INDEX weekly chart analysis shows a bullish trend forming through an impulsive Elliott Wave structure. The index has finished the Gray Wave 2 correction and entered Navy Blue Wave 1 within the larger Gray Wave 3. This setup signals the early stages of what could be a strong upward move over the coming weeks, with Navy Blue Wave 1 setting the trend foundation.

Navy Blue Wave 1 marks the start of the new impulse phase, typically showing steady price increases as the market builds directional strength. The end of Gray Wave 2 created favorable conditions for this new move, which often starts gradually but gains momentum with time. The weekly chart suggests the beginning of a new intermediate-term upward trend.

The structure indicates that the TASI INDEX is moving into a potential Gray Wave 3, with Navy Blue Wave 1 representing the initial move. This setup usually leads to stronger trending behavior as the market builds its bullish momentum. Traders should watch for early Wave 1 signs, such as improving technical indicators and increasing trading volume.

After Navy Blue Wave 1 completes, the index is expected to correct into Navy Blue Wave 2 before continuing higher. The weekly view stresses the significance of this emerging pattern, highlighting the importance of tracking price action and indicators to confirm the wave progression. The analysis points to a possible strong trend development, favorable for trend-following strategies.

A key level to monitor is 10657. If the index falls below this point, the current bullish outlook would need reassessment. Traders should prepare for potential bullish setups after the expected Wave 2 correction, keeping in mind that Wave 3 usually delivers stronger price movements.

TASI Index Elliott Wave technical analysis [Video]

Author

Peter Mathers

TradingLounge

Peter Mathers started actively trading in 1982. He began his career at Hoei and Shoin, a Japanese futures trading company.

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