Friday, December 12, 2014

Daily Market Trend Guide -- Friday, December 12, 2014

We have not been able to come out with regular edition of Daily Market Trend Guide in PDF Format. However, Market Forecast for the  Day is reproduced below in brief. Inconvenience caused is sincerely regretted.

BRIEF MARKET FORECAST FOR THE DAY



Once, today's analysis continue to remain on similar lines. The Markets are likely to open on a modestly positive note and look for directions. There are possibilities of a technical pullback on Daily Charts. If not, the Markets are likely to see range movement and no major downside is expected. The levels of 8340 and 8375 would act as immediate resistance an the levels of 50-DMA would act as support at Close.

Overall, some selective  purchases, especially in defensive stocks and IT can be made. However, over exposure should still be avoided. Positive caution is advised for today.


Milan Vaishnav,
Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member:
Association of Technical Market Analysts, INDIA


www.MyMoneyPlant.co.in
+91-98250-16331

 

Wednesday, December 10, 2014

Daily Market Trend Guide -- Thursday, December 11, 2014

MARKET REPORT                                                                    December 11, 2014
The Markets snapped its three day losing streak and ended the day with nominal gains while it recovered from its one-month lows. The Markets opened on a modestly negative note as expected and traded the morning session in a very capped range. It saw itself slipping in the red while it formed the day’s low of 8317 in the late morning trade. However, the Markets saw itself recovering from the low point of the day. It recovered from the intraday lows to trade back into the positive territory. The mid-afternoon trade once again saw paring of gains. Volatility refused to go away as some pullback was seen as the Markets went on to form the day’s high of 8376.80. These levels too were not sustained and the Markets came off a bit from here as well. It  finally ended the day at 8355.65, posting a nominal gain of 14.95 points or 0.18% while continuing to form a lower top and lower bottom on the Daily Bar Charts.


MARKET TREND FOR THURSDAY, DECEMBER 11, 2014

The analysis for the day continues to remain more or less on similar lines once again. We have seen the fall in the Markets being arrested and some attempts to find some intermediate bottom. Expect the Markets to open on a modestly positive note and attempt with its pullback. However, selling from higher levels still cannot be ruled out as the Markets are yet to form a higher top and higher bottom on the Daily Charts. Volumes and intraday trajectory would form critical cues for the day’s session.

The levels of 8385 and 8450 would act as immediate resistance for the Markets. The supports would come in at 8315 and 8260 levels. 

The RSI—Relative Strength Index on the Daily Chart is 47.0819 and it is neutral as it shows no bullish or bearish divergence or failure swings. The Daily MACD is bearish as it continues to trade below its signal line. 

On the derivative front, NIFTY December futures have seen open interest declining by over 1.49 lakh shares or nominal 0.67%. This figure is insignificant and overall good amount of open interest still continue to exist in the system.

Returning to pattern analysis, the Markets have seen paring of gains after it resisted to upper rising trend line and has thus made an intermediate top. It has continue to form lower tops and lower bottoms after that and now trades in vicinity of its 50-DMA. Any further downside will make the Markets test its 50-DMA levels at Close. However, the short that exists in the system are likely to lend support from now on.

Overall, as mentioned in our previous edition of Daily Market Trend Guide, the Markets have not shown any structural breach as it continues to trade above all of its moving averages. Though technical pullback is likely, it is advised to continue to tread the Markets cautiously. It is advised to continue to maintain liquidity and refrain from taking over-exposure in the Markets. Overall, positive caution 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
+91-98250-16331

Tuesday, December 9, 2014

Daily Market Trend Guide -- Wednesday, December 10, 2014

MARKET REPORT                                                                       December 10, 2014
Markets saw continued correction and declined for the third session in a row to end the day with similar losses. The Markets saw a relatively quiet opening as expected and traded flat around its previous close levels in the morning trade. It entered into positive territory for a very brief period as it formed its day’s high of 8444.50 only to return into negative territory again. After trading with limited losses, the Markets saw itself weakening further. It transformed itself into falling channel and remained in negative trajectory for the rest of the entire session while making fresh gradual lows. It went on to form the low point of the day at 8330.50 in the final minutes of the trade. Virtually no attempt to recover was seen and it finally settled the day at 8340.70, posting a net loss of 97.55 points or 1.16% while continuing to form a lower top and lower bottom on the Daily Bar Charts.

MARKET TREND FOR WEDNESDAY, DECEMBER 10, 2014

Technically speaking, the Markets continue to remain weak and are likely to extend its losses in the following session as well. In line with this, we can expect the Markets to open on a quiet to mildly negative note. However, given the short position see, it is likely that we might witness a temporary technical pullback in the Markets as well.

The levels of 8375 and 8410 will now act as immediate resistance while supports exist at 8290 and 8230 levels.

The RSI—Relative Strength Index on the Daily Charts is 45.7605 and it has reached its lowest value in last 14-days which is bearish. However, it does not show any Bearish Divergence. The Daily MACD remains bearish as it trades below its signal line.

On the derivative front, NIFTY December futures have went on to add another over 8.23 lakh shares or 3.86% in Open Interest. This signifies that there has been significant addition of shorts as it reflects in addition of Open Interest.

Taking a cue from pattern analysis, the Markets have resisted to the upper rising trend line while failing it to breach it on the upside. Following this failure to establish a fresh high the levels of 8626 now becomes a intermediate top for the Markets.  With the two days of decline as well, there is absolutely no structural breach on the technical charts as the Markets continues to trade above all of its moving averages.

Overall, in event of the correction continuing on the downside, we might get to see sharp technical pullbacks as well due to existing short positions. As mentioned, there is no structural breach on the Charts as the Markets continue to trade above all of its moving averages. This just being a healthy correction triggered weak technical indicators; it is advised to avoid creating fresh shorts as well. While continuing to restrict purchases stock specific approach 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
+91-98250-16331

Monday, December 8, 2014

Daily Market Trend Guide -- Tuesday, December 09, 2014

MARKET REPORT                                                                               December 09, 2014
Markets clearly saw some correction from higher levels today much on expected lines and ended the day with losses. Taking a cue from weak technical indicators, the Markets opened on a mildly negative note. After such opening, it went briefly in the green while it formed the day’s high of 8546.35. The Markets traded in green for a very brief period in the morning trade and then immediately returned back to the negative territory. It continued trade with modest losses until afternoon trade wherein the trajectory remained more or less sideways. It was in the second half of the session when the Markets saw some more pressure as it made its way lower. It went on to form its day’s low of 8432.25 towards the end of the session. No much recovery was seen and the Markets finally ended the day at 8438.25, posting a net loss of 100.05 points or 1.17% while forming a lower top and lower bottom on the Daily Bar Charts.


MARKET TREND FOR TUESDAY, DECEMBER 09, 2014

Speaking purely on technical grounds, the Markets still has room to continue its drift on the downside. We can fairly expect the Markets to open on a quiet note and trade with downward bias. While continuing to trade below its upper rising trend line, the Markets had been trading sideways and this downside is all likely to infuse short term weakness in the Markets.

On the upside, the levels of 8540 and 8595 would act as immediate resistance for the Markets. The immediate supports would exist at 8350 and 8310 levels.

The RSI—Relative Strength Index on the Daily Chart is 53.9182 and it has reached its lowest value in last 14-days which is bearish. Further, the RSI has set a fresh 14-day low whereas the NIFTY has not yet and this is Bearish Divergence. The Daily MACD continues to trade below its signal line and is therefore bearish.

On the derivative front, the NIFTY December futures have added over 11.66 lakh shares or 5.79% in Open Interest. NIFTY had added OI in the previous session as well. This very clearly suggests addition of good amount of short positions in the Markets. These shorts are also likely to prevent any serious downside as they themselves tend to lend support going ahead.

Looking at the pattern analysis, the Markets failed to clear the upward rising trend line to give a clear breakout on the upside. It moved sideways and then formed a distinct lower top and lower bottom. Usually speaking on technical grounds, this can induce further short term weakness but at the same time, looking at the shorts that are observed in the system, more of range bound consolidation rather than sharp correction can be expected.

Overall, the Markets are likely to remain in corrective mode but during this phase, more amount of range bound consolidation is likely to be seen rather than straight downside. Given the shorts in the system that are seen being created during previous couple of sessions, they are likely to lend support at lower levels and might prevent deeper downside. However, it is advised to stick to defensives and non-index components while making fresh purchases. Continuance of caution in the Markets is advised.

Milan Vaishnav,
Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member:
Association of Technical Market Analysts, INDIA

www.MyMoneyPlant.co.in
+91-98250-16331

Sunday, December 7, 2014

Daily Market Trend Guide -- Monday, December 08, 2014

MARKET REPORT                                                                              December 08, 2014
Markets remained absolutely in corrective mode as it ended the day with modest losses after spending the session in falling trajectory. The Markets saw a relatively flat opening and trade positively in the morning trade. It was in the morning trade itself that it formed its day’s high of 8588.35. It continued to trade with minor gains in and by afternoon, the Markets traded flat. The Markets continued to trade in very narrow range around its previous close until late afternoon, while it slightly dipped into the red. Though it recovered its losses again to trade flat but the last hour of the session saw renewed selling pressure as the Markets saw sharp paring of gains. It went on to form the day’s low of 8523.90 in the last minutes of the session. It however settled the day at 8538.30, posting a net loss of 26.10 points or 0.30% while forming a slightly lower top and lower bottom on the Daily Bar charts.


MARKET TREND FOR MONDAY, DECEMBER 08, 2014

The Markets are not completely out of the woods as it has been moving in a sideways trajectory for couple of days now. Expect the Markets to open with modest gains but at the same time it would continue to resist to the upper rising trend line. The Markets would continue to face selling pressure at higher levels even if it sees positive opening. Therefore, the analysis, would continue to remain more or less on similar lines due to the sideways consolidation on the Charts.

The levels of 8590 and 8645 would act as immediate resistance. The supports would come in at 8510 and 8430 levels.

The RSI—Relative Strength Index on the Daily Chart is 64.9443 and it has reached its lowest value in last 14-days which is bearish. Further, the RSI has formed a fresh 14-period low while NIFTY has not and this is Bearish Divergence. The Daily MACD now trades below its signal line and it therefore bearish. On the Weekly Charts, the Weekly RSI is 72.5433 and it is neutral as it shows no bullish or bearish divergence or failure swings. However, it trades in “overbought” area. The Weekly MACD stays bearish while trading below its signal line.

On derivative front, NIFTY December Futures have added over 2.43 lakh shares or 1.22% in Open Interest. This shows some fresh shorts to have been created in the system.
Going by the pattern analysis, even on the Weekly Charts, the Markets have been trading below the upper rising trend line of a Broadening Formation. As mentioned often in our previous editions, breakouts are very difficult to achieve because of such formations. Further, lead indicators are overbought on the Weekly Charts and also show bearish bias on the Daily Charts. Going by this,  even if the under current remains intact, the Markets will take a while before it gives a clear breakout on the upside and sustains it as well.

Taking a cue from this, we continue to reiterate our strategy of keeping fresh purchases limited to very select stocks and good non index components. Any up moves should be utilized to protect existing profits. Though the undercurrent remains favorable, some volatile consolidation cannot be ruled out. While maintaining liquidity, we continue to reiterate caution in the Markets.

Milan Vaishnav,
Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member:
Association of Technical Market Analysts, INDIA

www.MyMoneyPlant.co.in
+91-98250-16331