MARKET REPORT May
04, 2015
The Markets continued to decline on Thursday as well though
it saw relatively less volatility on the expiry day and ended the day with
losses. The Markets saw a negative opening and remained in negative territory
throughout the day. After seeing a negative opening, the Markets spent the
morning trade attempting a slow recovery. While it recovered some of its
morning losses, the second half of the session saw some more weakness creeping
in as the Markets pared its recovery and went on to form the day’s low of
8144.75. However, again, the last hour and half of the trade saw the Markets
attempting recovery again. The Markets recovered from these lows quite a bit
but still ended the day at 8181.50, posting a net loss of 58.25 points or 0.71%
while continuing to form a lower top and lower bottom on the Daily Bar Charts.
MARKET TREND FOR MONDAY, MAY 04, 2015
Markets shall open today after a long weekend as Friday was
a trading holiday. Today, we can expect a positive opening but at the same
time, the session would be crucial to see if the Markets attempt a pullback.
The Markets currently rules below 200-DMA and have closed below this level. If
the Markets sees a expected level of positive opening, it would open and trade
just below its 200-DMA. It would, therefore, be critical to see if the Markets
are able to capitalize on the expected positive opening.
For today, the levels of 8230 and 8270 will act as immediate
resistance levels. The supports would come in at 8140 and 8105 levels.
The RSI—Relative Strength Index on the Daily Chart is
31.7656 and it does not show any failure swings. The NIFTY has set a fresh
14-period low whereas RSI has not, and this is Bullish Divergence. The Daily
MACD remains bearish trading below its signal line. On the Weekly Charts, the
Weekly RSI is 44.0568 and it has reached its lowest value in last 14-weeks
which is bearish. However, it does not show any bullish or bearish divergence.
The Weekly MACD remains bearish trading below its signal line.
On the derivative front, the NIFTY MAY Futures have added
Open Interest. Both the NIFTY and Stocks rollover have been healthy and have
remained above its 3-month average.
Coming to pattern analysis, on the Weekly Charts, the
Markets have tested its 50-DMA and have attempted to take support there.
Usually this is likely to act as support. On the Daily Chart, the Markets have
closed below its 200-DMA but has remained within its filter as of now. In case
of positive opening, this 200-DMA level is likely to pose resistance to the
Markets on its way up.
Overall, today’s would be a crucial session and it would be
important to see the behaviour of the Markets vis-a-vis the levels of 200-DMA.
It would be important for the Markets to capitalize on the positive opening, if
it sees one, and attempt a pullback. If the Markets move past the levels of
200-DMA, slow and selective purchases may be made while protecting profits at
higher levels. Overall, cautious optimism 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
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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