Friday, July 22, 2011

Daily Market Trend Guide -- Friday, July 22, 2011

MARKET TREND FOR TODAY

The Markets yesterday continued to expectedly remain in corrective mode, though it traded in a capped range and on low volumes, but ended the day with moderate losses and in the process have formed a lower top and lower bottom on the Daily High Low Charts.

The Markets remained in consolidation mode and yesterday it has given a minor break down as it gave lower top and lower bottom and also dipped below its 100DMA.

For today, the Markets are likely to see positive opening despite technical weakness on back of positive closing of US Markets and prevailing positive Asian Markets.

With the positive opening expected in the Markets, the levels of 5570 and 5590 are likely to act as resistance and the levels of 5500 and 5760 are likely to act as supports.

The RSI—Relative Strength Index on the Daily chart is 49.2904 and it continues to remain neutral as it shows no negative divergence or failure swings. The Daily MACD continues to remain bearish, trading below its signal line.

Having said this, even though the Markets may open strong and positive on back of global cues, the technicals, as it did in the past, are likely to take over and may resist the positive opening and the Markets may form the negative territory after opening and trading into positive initially.

The Markets have closed below its 100-DMA and now this level will act as resistance at Close. Also, the NIFTY Futures have shed Open Interest showing unwinding of the positions. In view of this, there are bright chances that Markets may come off its highs after attempting a positive opening and it may not capitalize on that.

All and all, it is advise again not to get carried away with the positive opening and observe the intraday trajectory it forms. Also, it is advised to continue with the stock specific approach while vigilantly protecting profits at higher levels. Stock specific cautious approach is advised as overall bias remains slightly negative. 


Milan Vaishnav,
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
+91-9825016331
milanvaishnav@mymoneyplant.co.in
milanvaishnav@yahoo.com

Thursday, July 21, 2011

Daily Market Trend Guide -- Thursday, July 21, 2011

MARKET TREND FOR TODAY

We had very categorically expected in our yesterday’s edition of Daily Market Trend Guide that the Markets are all likely to open on a positive note but gradually are likely to correct as technicals pointed towards such possibilities. The Markets behaved precisely in this manner, opened positive but ended the day with losses and thereby formed a slighter higher top but lower bottom on the Daily High Low Charts.

Today, such corrective behavior of the Markets is expected to continue. The Markets are likely to open on a mildly negative note and look for directions, keeping the session volatile and  highly stock specific.

With the Markets expected today to open on a mildly negative note, the levels of 5590 and 5610 are likely to act as resistance and the levels of 5506 and 5480 are likely to act as supports.

The RSI—Relative Strength Index on the Daily Chart is 50.5043 and it shows no negative divergence or failure swings and is therefore neutral.

The Daily MACD continues to remain bearish as it trades below its signal line.

On the Candles, An Engulfing Bearish Line has occurred. If this occurs during an uptrend, which is the case with NIFTY, it indicates a temporary loss of momentum for the Markets.

The Premium in the futures in yesterday’s trade reduced to just 2-odd points from 12 points in the previous session and with little addition in the Open Interest, some shorts are seen being created again in the system. Having said this, the technicals as well as pattern analysis suggests that the Markets are likely to remain in corrective mode today also and this may keep the session both volatile and range bound. Some intermittent short covering may not be ruled out but overall the session is likely to have a negative bias.

Overall, it is advised to continue with the cautious and stock specific approach while protecting profits at higher levels.
  

Milan Vaishnav,
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
+91-9825016331
milanvaishnav@mymoneyplant.co.in
milanvaishnav@yahoo.com

Wednesday, July 20, 2011

Daily Market Trend Guide -- Wednesday, July 20, 2011

MARKET TREND FOR TODAY

The Markets saw a spate of short covering yesterday, especially in the second half of the session as it recovered from its day’s low to end the day with decent gains and in the process have formed a higher top and a slightly higher bottom on the Daily High Low Charts.

Today, we will see the Markets opening on a positive note on back of strong closing of the US Markets but at the same time, the technicals too are expected to take over.

With the Markets expected to open on a positive note following strong closing of the US Markets, the technicals are expected to take over and there are bright chances that the Markets transforms itself into falling trajectory post positive opening. For today, the levels of 5650 and 5670 are expected to act as resistance and the levels of 5580 and 5540 are expected to act as supports.

The RSI—Relative Strength Index on the Daily Chart is 54.7641 and it shows no negative divergence or failure swings and is therefore neutral.

The Daily MACD however continues to remain bearish as it trades below its signal line.

Having said this, it is important to note that the Markets in the two previous session, especially yesterday have shed Open Interest with the rise and this is a very clear indication that there has been short covering in the Markets instead of any fresh longs. Also important to note that any positive opening today will cause the Markets to open near a very important pattern resistance of falling trend line. Thus, even with positive opening today, there are bright chances that the Markets pares its early morning gains as the session progresses.

All and all, it is advised not to get carried away with any seemingly strong opening as the trend would reverse only above 5700-5750 levels. Even with the positive opening, it is advised to remain ultra selective in taking longs and continue to protect profits at higher levels.

Overall, a cautious and stock specific approach is advised for today. 


Milan Vaishnav,
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
+91-9825016331
milanvaishnav@mymoneyplant.co.in
milanvaishnav@yahoo.com

Tuesday, July 19, 2011

Daily Market Trend Guide -- Tuesday, July 19, 2011

MARKET TREND FOR TODAY

Yesterday’s session remained quite subdued as the Markets traded in negative trajectory in a narrow range with overall downward bias and ended the day with moderate losses. In the process, the Markets have formed a lower top and lower bottom on the Daily High Low Charts.

Today, the Markets are expected to continue with such corrective behavior and is likely to see flat to mildly negative opening again, and again continue to depend upon the intraday trajectory that it forms.

Today, with the Markets expected to open on a flat to mildly negative note, the levels of 5590 and 5610 are likely to act as resistance and the levels of 5510 and 5480 are likely to act as supports. Much would continue to depend upon the intraday trajectory as well as the volumes which remained much on the lower side.

The RSI—Relative Strength Index on the Daily Chart is 50.9202 and is neutral  as it shows no negative divergence or failure swings.

The Daily MACD has turned bearish since last two sessions and continues to remain so with it trading below its signal line.

The Markets have  closed a notch below its 100-DMA of 5569 and any breach at Close levels is likely to take it to another support level of 50-DMA at 5505.

The F&O data too points towards continuing short term bearish / corrective conditions. The NIFTY Futures, though nominal, have shed total Open Interest of around 1% showing some liquidation of long positions. Stock futures too have  shown shedding in Open Interest.

All and all, the corrective sentiment in the Markets is likely to continue and it is advised to remain highly selective in taking fresh long positions while vigilantly protecting profits at higher levels. Overall cautious outlook is advised for today as the Markets are likely to continue to remain in range, and also intermittently volatile.


Milan Vaishnav,
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
+91-9825016331
milanvaishnav@mymoneyplant.co.in
milanvaishnav@yahoo.com

Monday, July 18, 2011

Daily Market Trend Guide -- Monday, July 18, 2011

MARKET TREND FOR TODAY

The session on Friday remained quiet and directionless as the Markets moved in no direction, traded in a very narrow range and ended the day with nominal losses and in the process have formed a lower top and higher bottom on the Daily High Low Charts.

The Markets are likely to start new week on a silent note and is likely to give flat to mildly negative opening today and look for directions.

The Markets are likely to open on a flat to mildly negative note and along with the intraday trajectory that it forms, the volumes too are likely to play critical role in deciding trend for today as well as for coming week.

For today, the levels of 5600 and 5635 are likely to act as resistance and the levels of 5570 and 5520 are likely to act as supports.

The RSI—Relative Strength Index on the Daily Chart is 52.1638 and is neutral as it shows no negative divergence or failure swings.

The Daily MACD, has expectedly turned bearish as it now trades below its signal line.

On the Weekly Charts, the RSI is 49.3091 and it is neutral as it shows no negative divergence or failure swings. The Weekly MACD trades above its signal line.

Going by the pattern analysis, the Markets have resistance at 5653-5670 levels in form of falling trend line drawn from 6335 levels on the Weekly Charts. On the Daily Charts too, it has a similar pattern resistance around 5700. Having said this, as mentioned often in our previous editions of Daily Market Trend Guide, the Markets shall attempt a trend reversal and a sustainable up move only after it moves past the levels of 5700. Until this happens, it is likely to trade in a capped range, and also bit volatile and with negative bias.

All and all, it is advised to continue with extremely cautious and stock specific approach while continuing to protect profits on either side vigilantly. Overall, cautious outlook is advised for today.

Milan Vaishnav,
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
+91-9825016331
milanvaishnav@mymoneyplant.co.in
milanvaishnav@yahoo.com