MARKET REPORT November
21, 2014
The markets once again attempted a fresh breakout on Friday
as it opened positive and ended the day with decent gains. The Markets saw a
decent opening and post positive opening, the Markets saw some further strength
coming in as it posted its fresh lifetime high in the late morning trade.
However, after this the Markets saw
itself coming of these levels as it retraced a bit and trading in a sideways
trajectory in the afternoon trade. The second half of the session saw some
strength returning again as it formed a fresh high of 8489.80 in the final hour
of the trade. The Markets hovered around those levels and finally settled the
day at 8477.35, still posting a decent gain of 75.45 points or 0.90% while
forming a higher top and higher bottom on the Daily Bar Charts.
MARKET TREND FOR MONDAY, NOVEMBER 24, 2014
Markets have ended near the high point of the day and
technically speaking, it is likely to continue the up move. We can expect a
quiet but decent opening and further expect the Markets to confirm the
attempted breakout. The Markets are trading “overbought”. This warrants some
caution but even technically speaking, the buoyant Markets tend to remain
overbought while they consolidate at given levels.
The levels of 8500 and 8535 would act as expected resistance
levels as the Markets trade in uncharted territory in case of up move. The
supports would come in much lower at 8270 and 8215 levels.
The RSI—Relative Strength Index on the Daily Chart is
72.8735 and it trades in “overbought” zone. It does not show any failure swing
but it shows Bearish Divergence as the NIFTY has formed a fresh 14-period high
but RSI has not. The Daily MACD continues to remain bullish trading above its
signal line. On the Weekly Chart, the Weekly RSI is 73.1207 and it too trades in
“overbought” territory. However, it has reached its highest value in last
14-weeks which is bullish as it shows no bullish or bearish divergence. The
Weekly MACD is bullish as it has reported a positive crossover.
On the derivative front, the NIFY November futures have shed
4.48 lakh shares or 2.10% in Open Interest. This will have little significance
now as we enter the expiry week and this standalone data would be of little
use.
Going by the pattern analysis, the markets continue to test
the upper rising trend line of a broadening formation on both Weekly and Daily
Charts. Given this, it has attempted a breakout from this on the upside.
However, at the same time, the Markets remains “overbought” and this may cause
the Markets to post gradual up moves while seeing intermittent bouts and consolidation.
Overall, the reading the Daily and Weekly Charts, even
though the Markets trade “overbought” at current levels, the under tone remains
certainly bullish and buoyant. However, given the overbought nature, the
Markets may see volatility remaining ingrained with some profit taking bouts
also at intermittent periods. However, defensives are expected to outperform.
Overall, while remaining vigilant, cautious optimism is advised for the day.
Milan Vaishnav,
Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA
www.MyMoneyPlant.co.in
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA
www.MyMoneyPlant.co.in
+91-98250-16331
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