Other Sector – Elliott Wave & Price Action Analysis

The Other Sector appears to have completed a potential Ending Diagonal/Rising Wedge near 2,822, followed by a strong decline toward the 2,160 area.

From an Elliott Wave perspective, this decline could represent the completion of Wave W. The subsequent recovery toward approximately 2,500 may have formed Wave X, retracing roughly 50% of the previous decline.

After completing the X-wave recovery, the index resumed its decline and has now reached around 1,866, which is an important historical and technical support zone. This decline may potentially represent Wave Y, completing a larger W-X-Y corrective structure.

The price-action structure also shows a possible Head-and-Shoulders pattern, with the neckline around the 2,200–2,202 area. The breakdown below this neckline provided further downside momentum toward the current support zone.

At the current level, we are watching for a potential recovery because:

1,866 is a significant support area.
The decline appears relatively extended.
RSI is showing bullish divergence, suggesting weakening downside momentum.
MACD is showing bullish divergence, suggesting weakening downside momentum.
The potential W-X-Y structure may be approaching completion.

However, 1,866 should be treated as a potential Wave-Y completion rather than a confirmed bottom.

For confirmation, we would like to see the index recover and break above the 2,202 area. A sustained move above this level would increase the probability that the decline from approximately 2,500 has completed and that a larger recovery is beginning.

Our preferred strategy is therefore not to enter immediately just because price has reached 1,866. Instead, we will wait for upside confirmation and then look for a pullback/retest after the breakout.

If the index breaks above 2,202 and subsequently holds the breakout zone on a pullback, that would provide a much stronger risk/reward setup for a long entry.

The bearish scenario would remain valid if price fails to establish a recovery and continues breaking below the 1,866 support zone, in which case the Wave-Y interpretation would need to be reassessed and lower levels could become possible.