Sunday, April 5, 2015

Daily Market Trend Guide -- Wednesday, March 25, 2015

Daily Market Trend Guide                                                    March 25, 2015                 
MARKET REPORT
The Market yesterday opened more or less  flat and turned positive immediately in the initial hours of trade and remained in the positive trajectory till mid of the trading session. Thereafter, the markets started  encountering mild selling pressure around noon. This dragged the market , slowly but steadily  near to the previous close and also  briefly into red. Immediately thereafter, market witnessed sharp up move, which was met with equally sharp  downward pressure . In the afternoon trades, market saw very choppy session.  Markets witnessed sharp and sudden offloading in the last hour of trade.  Towards the end of the session, Two days ahead, volatility was seen due to March expiry .
In spite of the sharp volatility, markets traded precisely in the range foretold-  8644 as resistance at upper levels, with supports in the range of 8508 – 8520. The  market gave intraday high of  8627 and intraday low of  8535.

MARKET TREND FOR WEDNESDAY,  MARCH 25 2015


Since the  start of  expected correction, the markets have behaved and remained in the foretold and expected range. It was mentioned in yesterday’s Daily Market Trend Guide that It remains to be seen, whether important supports are breached or markets takes support at these levels and correction takes a breather.

Likewise, market did test the important support range, but  no downward breakdown was seen,  even in a very volatile session towards the end.

However, Technical Analysis of Daily High Low Chart reveals that  even though markets have not  downward breached these important support levels  of Pattern and Moving Averages as yet, it has closed very near to these levels.

The Technicals

For today, Candlesticks Chart of Nifty is very eventful; technically. Colour of the  candle is insignificant for today as there is very minor difference between open and close levels of Nifty . Two bearish formations - A long upper shadow  and An on-neck line have occurred  on Candlesticks charts. The MACD is bearish since it is trading below its signal line. The RSI has just reached its lowest value in the last 14 period(s).  This is bearish.

Pattern Analysis of Daily High Low Chart of Nifty shows that the markets are ranged and neither  able to  upward penetrate the resistance levels, now important supports  are downward broken. Also the  important support of 100 Day Moving Average is also still intact.

F&O Data Analysis

This week being March series expiry week, analysis of F&O data is also important, which reveals that there is a build up of maximum open interest in Nifty  options side is at strike 8500 puts indicating support. Also, build up is seen on near money strikes. Roll over , so far is low and  roll over cost is high. This will make March expiry volatile. Roll overs seem to be devoid of momentum, as Nifty roll
overs is just around 32 %

Conclusion

In light of this technical analysis of Nifty for today read along with F&O data, it can be concluded that today market are slated to open on a flat note with positive bias. Today’s open and initial hours of trade becomes very important. For today also the support range of 8508 – 8520 is expected to act as major supports for the markets. The markets need to open and sustain above this range to avoid weakness.  Any up move will face resistance at around 8644 today also. Today’s session is expected to be volatile also as indicated by F&O data, as we near the March expiry.

However, no major downward breach is expected, at least of today, as - an inverted hammer  had occurred on Candlesticks charts.  If this occurs during a downtrend which appears to be the case with NIFTY it implies a reversal. Also the important supports of Patterns and 100 Day Moving Average of Nifty are still intact and have not been broked.

It is advised to be cautious  and alert at every highs today, with positive bias.


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

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