Friday, August 10, 2012

Daily Market Trend Guide -- Friday, August 10, 2012

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MARKET TREND FOR TODAY

Expect the Markets to open today on a mildly negative note and look for directions. Primarily speaking, the onset of corrective activity that begun yesterday after the Markets came off its highs is likely to continue and the intraday trajectory would guide  the consolidation activities.

The levels of 5368 an 5390 will continue to act as resistance and the supports are expected to come in at 5305 and 5170 levels.

The RSI--Relative Strength Index on the Daily Chart is 61.49 and it shows no negative divergence or failure swing. The Daily MACD continues to trade above its signal line.

Having said this, with reference to the yesterday's session, the Markets have formed a marginally lower top and lower bottom on the Daily High Low Charts. This has made the levels of 5378, a temporary top for the Markets. Any sustainable fresh up move shall occur only after the Markets moves past these levels. Until then, corrective / consolidation activities shall continue.

The Markets are also likely to continue to give some negative reaction to the dismal June IIP numbers which were negative. Overall weaker technials shall aggravate the reaction.

All and all, the session is likely to remain volatile today, like it has been in previous session and consolidation / minor correction is likely to continue. It is continued to be advised to refrain from aggressive longs and maintain liquidity. Fresh positions may be taken, but on highly selective basis. The intermittent bouts of profit taking may be seen. Overall, continuance of cautious outlook is advised for today.

Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
 

Thursday, August 9, 2012

Daily Market Trend Guide -- Thursday, August 09, 2012

MARKET TREND FOR TODAY                                                                    August 9, 2012
Yesterday, the Markets traded almost in line with what was analyzed in our yesterday’s edition of Daily Market Trend Guide. On expected lines, the Markets opened positive, though volatile but remained positive but also saw some bouts of profit taking towards the end to end the day closing absolutely flat paring all of its gains. The Markets during the day touched the intraday high of 5377.60. However, after volatile movement in the intraday 25-odd point range, the Markets gave off all of its gains towards the end of the day and Closed at 5338.00, posting a negligible gain of 1.30 points or 0.02%. The volumes too remained around average. The Markets have, however, formed a higher top and higher bottom on the Daily High Low Charts.

Today’s analysis remains more or less similar than that of yesterday. Today also, we expect a moderately positive opening in the Markets but, at the same time, also foresee some minor correction / consolidation setting in, whose basic signs have started appearing yesterday with fall in net open interest in stock futures.

For today, the levels of 5360 and 5385 are immediate resistance levels and the levels of 5290 and 5235 are immediate supports.

The RSI—Relative Strength Index on the Daily Chart is 63.4662 and it has reached its highest value in last 14-days which is bullish. It does not show any positive or negative divergence. The Daily MACD continues to trade above its signal line.

However, on the Candles, A Long Upper Shadow has occurred. This is a typically bearish signal, potentially, especially when it occurs after a rally or near the highs or near resistance levels. 

Further to this, though NIFTY futures have added in net open Interest, the Stock futures have shed 1.23 crore share in total open interest. This too shows a moderate sign of possible consolidation / minor correction.

Having said all this, we can expect a moderately positive start to the Markets but there are continuing chances that, like yesterday, we see some volatile movement and some intermittent bouts of profit taking.

All and all, it is advised to continue to refrain from taking aggressive positions on either side and keep protecting profits at higher levels on the long side. Further, while taking fresh positions on either side, ultra selective approach is advised. Cautious outlook is advised for today.

Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331


Wednesday, August 8, 2012

Daily Market Trend Guide -- Wednesday, August 08, 2012

MARKET TREND FOR TODAY                                                            August 8, 2012
The Markets had yet another decent session wherein it continued with its up move and ended the day with decent gains after a flat opening. The Markets opened on a quietly positive note and for the entire session, remained in positive rising trajectory as it kept gradually making new highs. The Markets went on to give its intraday high of 5350.10 towards the end of the session and ended the day at 5336.70, slightly off its highs but still posting decent gain of 54.15 points or 1.03%. The volumes continued to improve. It has made a sharply higher top and higher bottom on the Daily High Low Charts.

The Markets today, again are expected to open on a moderately positive note and look for directions but this time, it has closed near one of the  Double Top resistance and has a near term resistance further ahead. So, key would be to see the intraday trajectory the Markets form and the behavior of the Markets vis-à-vis these two resistance levels.

Today, the levels of 5360 and 5398 would be the two pattern resistance levels that the Markets face and the behavior of the Markets vis-à-vis these two levels would be critical to see.

The lead indicators continue to remain in place. The RSI—Relative Strength Index on the Daily Chart is 63.3721 and it has reached its highest value in last 14-days which is bullish. It does not show any negative divergence. The Daily MACD continues to trade above its signal line.

The volumes have moderated in yesterday’s rise, with most of the Index and Sectoral Index components have traded either around the average volume or below it. Though NIFTY and Stocks have both continued to add in total open interest.

Going by this, it is likely that the Markets continues with its up move in the opening session. However, going by pattern analysis, it is important to note that at the same time, Markets would be near their pattern resistance shown in the Charts. There are chances that we see intermittent profit booking at higher levels and a mild correction is seen. It is thus advised to keep protecting profits at higher levels and remain ultra selective in taking fresh positions. Overall, positive caution is advised for today.

Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331


Tuesday, August 7, 2012

Daily Market Trend Guide -- Tuesday, August 07, 2012

MARKET TREND FOR TODAY                                                               August 7, 2012
After two days of brief consolidation on the Daily Charts, the Markets have again attempted a breakout on back of strong and favorable technicals fuelled by positive global cues as it ended the day with decent gains after opening on a strong note. The Markets opened on a strong and positive note and importantly maintained its gains throughout the session. After opening on a firm note, the Markets move sideward gradually adding gains as it gave its intraday high of 5293.20. The Markets kept moving in a 20-odd point range and it finally ended the day on a strong footing at 5282.55, posting a decent gain of 66.85 points or 1.28%. It has formed a sharply higher top and higher bottom on the Daily High Low Charts.

Today, after yesterday’s up move, a quiet opening in the Market is expected with the Markets opening flat and then are expected to consolidate again, looking for directions. The Markets have ended near a double top resistance, as evident from the Chart and it would be critical to see if they move up further or consolidate around these levels.

For today, the levels of 5285 and 5340 are expected to act as resistance and the levels of 5250 and 5210 are expected to act as immediate supports.

The RSI—Relative Strength Index on the Daily Chart is 59.3156 and it has reached its highest value in last 14-days which is bullish. It does not show any negative divergence. The Daily MACD has reported a positive crossover and is bullish as it now trades above its signal line.

On the Candles, A Rising Window occurred. Such formation usually implies a continuation of the bullish trend. 

The NIFTY and Stock Futures have continued to add in total Open Interest and the NIFTY PCR stands at 1.08 as against 1.11.

Overall, continuation of up move is expected but at the same time, some consolidation and minor profit taking too cannot be ruled out. It is advised to protect profits at higher levels and selective purchases should be done. However, aggressive positions should still be avoided. Balanced approach with caution and positive outlook is advised for today.

Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331