Tuesday, May 22, 2018

MARKET OUTLOOK FOR TUESDAY,MAY 22, 2018


MARKET OUTLOOK FOR TUESDAY,MAY 22, 2018

Markets had a thoroughly disappointing session on Monday as after staying very briefly in the green in the morning; it slipped and remained in a falling trajectory all throughout the day. The benchmark Index NIFTY ended the day losing 79.70 points or 0.75%. The broader Markets saw extremely dismal performance with Midcap and  Small Cap universe losing between 1.80% to 2.46%. Poor sector performance was seen in Pharma, Auto, Media, Metal and Realty as they saw losses anywhere from 1.6% to 3.3%.
As we approach Tuesday, the level of 10538 remains extremely important to watch for. This level is the 100-DMA of the Markets. The NIFTY has ended a notch below this level but still remains within its filter.
Tuesday is likely to see a quiet opening and we might see Markets attempting to find some stability at current levels. In any case, for NIFTY to stabilize, moving past 10538 and sustaining above that will be of immense importance for the Markets.
The levels of 10538 and 10590 will act as immediate resistance area for the Markets. Supports come in at 10490 and 10450 zones.
The Relative Strength Index – RSI on the Daily Chart is 41.8687 and it has marked a fresh 14-period low which is bearish. RSI, however, does not show any divergence against the price. Daily MACD stays bearish while trading below its signal line. Apart from a black body that occurred, no significant formations were seen on the Candles.
Pattern analysis shows that NIFTY which had broken above 10550-10600 zone which represent multiple resistance area earlier, not only suffered a full throwback but dipped below the breakout level and in the process failing the breakout.
Overall, with the NIFTY dipping below 10550-10600 zones, it now once again trades inside the earlier broad trading zone of 10310-10600. However, it currently flirts with its 100-DMA. It would be important to see if this level is held as support at Close levels. NIFTY presently stays within the filter of this support and for it to stabilize a move above 10538 and sustenance above this level will be important. We recommend keeping overall exposures light in the present scenario. Focus should be now to start reducing the shorts positions if any as the NIFTY is nearly oversold on some of the oscillators. Quality purchases may be made in modest quantities. Cautious view is advised for the day.
STOCKS TO WATCH:
Unwinding was seen on counters like HINDALCO, ITC, RNAVAL, PTC, NHPC, ADANI POWER, HDFC BANK, FEDERAL BANK, BAJAJ FINANCE, AXISBANK, VOLTAS and NCC.

(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research & Advisory Services, Vadodara. He can be reached at milan.vaishnav@equityresearch.asia)

Milan Vaishnav, CMT, MSTA
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK 
www.EquityResearch.asia
http://milan-vaishnav.blogspot.com

+91- 70164-32277  /  +91-98250-16331  
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com


Sunday, May 20, 2018

MARKET OUTLOOK FOR MONDAY,MAY 21, 2018


MARKET OUTLOOK FOR MONDAY,MAY 21, 2018

Bearish undertone continued to persist in the Friday’s session as the NIFTY opened negative and remained in the falling channel throughout the session. It ended the day losing 86.30 points or 0.81%. The nervousness was evident on Friday as the political drama shifted to proving majority on the floor on the following day.
What is happening in Karnataka is also being viewed as a prelude to what we can expect in the 2019 general election. Life sprouting out of almost non-existent opposition is seen as a factor which can likely instill political uncertainty in the country. This was first seen during Gujarat assembly elections and now became more evident during the Karnataka polls.
As we step into Monday’s trade, BJP’s resignation even before the floor test is an event that can have knee-jerk reaction in the Markets. There are high chances that the NIFTY might see a weak opening on Monday. However, this being said, it is also likely that post weaker opening, the NIFTY might spend rest of the session trying to improve and in the process, the 100-DMA levels will be very crucial to watch for as a major support at Close.
The levels of 10630 and 10665 will act as resistance for the Markets. Supports come in at 10165 and 10540 zones.
The Relative Strength Index – RSI on the Daily Chart is 47.3261. It has marked a fresh 14-period low and this is bearish. RSI does not show any divergence against the price. The Daily MACD stays bearish while trading below its signal line. No significant formations were seen on Candles.
Overall, Monday is likely to turn out to be a volatile day for the Markets. We will continue to see selective buying at any given levels in the sectors that are anyway outperforming the general markets or in the stocks which have posted good results. In event of any possible downside, the 100-DMA levels will be crucial to watch for. Though overall exposures should be kept at modest levels, lower levels can be utilized to make good quality purchases. With political dust nearly settled, Markets may now attempt to find its bottom from lower levels in days to come.
STOCKS TO WATCH:
Relatively resilient technical setup is observed in stocks like TATA GLOBAL, MANAPPURAM FINANCE, GUJARAT NARMADA, CADILA HEALTH, UJJIVAN, INDIABULLS REAL ESTATE, KARNATAKA BANK, TECH MAHINDRA, TVTODAY and LINDE INDIA.

(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research & Advisory Services, Vadodara. He can be reached at milan.vaishnav@equityresearch.asia)

Milan Vaishnav, CMT, MSTA
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK 
www.EquityResearch.asia
http://milan-vaishnav.blogspot.com

+91- 70164-32277  /  +91-98250-16331  
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com