MARKET TREND FOR TODAY
November 16, 2012
The Markets had an disappointing session yesterday, but
quite on expected lines as it continued to register losses and ended the day
again on moderate losses. The Markets opened lower and remained negative for
the entire session. After opening on a negative note, the Markets continued to
slide gradually in the first half of the session as it gave its intraday low of
5603.55, testing and breaching supports of 5630 levels. The Markets however saw
some mild support coming in and recovered a bit from those levels. It finally
ended the day at 5631, with net loss of 35.95 points or 0.63%. It continued to
form a lower top and lower bottom on the Daily High Low Charts.
All is just not well with the Markets. The Markets are again
expected to open on a flat to mildly negative note and look for directions. The
opening of the Markets and its behaviour thereafter vis-à-vis the levels of
5630 would be critically important to determine if the Markets are to slip into
further weakness or not. The intraday trajectory of the markets would be
equally important and any dip below 5630 is likely to take the Markets further
down.
For today, if the Markets opens below 5630, then 5630 and
then 5700 would be resistance levels for today. Supports come in at 5605 and
5560 levels.
The RSI—Relative Strength Index on the Daily Chart is
45.5531 and it is neutral as it shows no negative / positive or bullish /
bearish divergence and also it does not show any failure swing. The Daily MACD
is bearish as it continues to trade below its signal line.
On the Candles, the A Falling Window has occurred.
This usually implies continuation of bearish trend. The two candles preceding this
formation were black and this makes the pattern even more bearish.
To add to this, the NIFTY future have shed over 13.86 lakh
shares or 7.56% in Open Interest which very clearly signifies unwinding of long
positions yesterday. Similar trend was witnessed with stock futures. NIFTY PCR
stands at 1.01 as against 1.06.
We can fairly conclude that the Markets are not at all in
good shape and no significant up move shall occur until the Markets moves past
the levels of 5700+. Until it remains above 5630, it shall remain in a broad
range and if it slips below 5630, it can certainly induce further weakness.
All and all, we continue with our advice to refrain form
taking aggressive long positions and any profit on the longs should be
vigilantly protected. While taking fresh positions on very selective manner, we
continue to reiterate our downward bias on the Markets until it moves past the
levels mentioned above.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
