Wednesday, March 11, 2015

Daily Market Trend Guide -- Wednesday, March 11, 2015

MARKET REPORT                                                                                 March 11, 2015
While the US Dollar continued to scale its peak, it affected the Markets as it witnessed some more downside before it ended the day with modest losses. The Markets saw a relatively flat start and after opening on a flat note moved in a very narrow range in the early morning trade. The Markets attempted a minor up move in the morning wherein it traded in positive territory briefly while marking its intraday high of 8778. Soon, the Markets retraced again to trade on an absolutely flat note in the afternoon trade. It was in the second half of the session that the Markets saw weakness creeping in again. It dipped in to the negative and went on form the day’s low of 8677.35 coming off nearly 100-odd points from the high point of the day. Though some sharp recovery was seen in the final minutes of the trade, it finally ended the day at 8712.05, posting a modest loss of 44.70 points or 0.51% while continuing to form a lower top and lower bottom on the Daily Bar Charts.


MARKET TREND FOR WEDNESDAY, MARCH 11, 2015
Markets stand at a very critical juncture as of today. Though the Global Markets remain subdued, we can once again expect some stability in our Markets today. Expect the Markets to open on a flat to mildly negative note and look for directions. The Markets currently trade above its important support levels. In event of any temporary weakness, these levels may be tested and even if they are not tested, the volatility will remain ingrained in the Markets, at least for the immediate short term.

The levels of 8775 and 8830 will act as immediate resistance for the Markets. The supports come in at 8640 and 8610 levels.

The RSI—Relative Strength Index on the Daily Chart is 46.3062 and it has reached its lowest value in last 14-days which is bearish. Also, RSI has formed a fresh 14-period low while NIFTY has not yet and this is Bearish Divergence. The Daily MACD continues to remain bearish trading below its signal line.

On the derivative front, NIFTY March futures have shed over 2.06 lakh shares or 0.83% in Open Interest. This certainly signifies some further unwinding of positions but at the same time, this relatively small.

Coming to pattern analysis, the Markets currently continues to trade above all the 3 moving averages and above is important pattern support levels as well. Further, NIFTY has pared nearly 400-odd points from its peak. However, it continues to keep its overall up trend intact as it has not yet the rising channel that it has been trading in. The important support comes in at 8640-8600 levels and it would be important to review the behaviour of the Markets around these levels in event of any temporary weakness.

All and all, we can expect some stability to come in but in any case volatility would continue to remain embedded in the Markets in the immediate short term. We continue to reiterate our advice on curtailing exposures at moderate levels. More emphasis should be laid on protecting profits at higher levels. With keeping focus on maintaining adequate liquidity, cautious outlook is advised or 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, March 10, 2015

Daily Market Trend Guide -- Tuesday, March 10, 2015

MARKET REPORT                                                                                  March 10, 2015
Initiated by weak technicals and further stimulated by fears of early rate hike by US, the Markets saw a deep cut as it opened nearly gap down and ended the day with good amount of losses. The Markets saw a negative start and within initial seconds of the trade, the losses deepened and the Markets traded significantly down. Post opening losses, the Markets moved in sideways trajectory and did so in a very narrow range. While showing no signs of recovery, the Markets saw some more weakness creeping in. It went further down to form the day’s low of 8740.45 towards the end of the session. No recovery was seen and the Markets finally ended the day at 8756.75, posting a deep cut of 181 points or 2.03% while forming a sharply lower top and lower bottom on the Daily Bar Charts.


MARKET TREND FOR TUESDAY, MARCH 10, 2015
Markets are expected to see a flat to mildly positive opening today and there are chances that we see some stability returning to the Markets. The Markets have ended the day yesterday near one of the pattern supports and the opening levels of the Markets and the intraday trajectory that it forms thereafter would be critically important for the Markets. If the Markets opens and drifts lower, then the possibility of the Markets testing the levels of 8640 cannot be ruled out. However, stability in the initial trade is expected.

For today, the levels of 8830 and 8875 will act as resistance and the levels of 8730 and 8640 are likely to act as important supports.

The RSI—Relative Strength Index on the Daily Chart is 48.7251. It has reached its lowest value in last 14-periods which is bearish. The RSI has set a fresh 14-period low whereas NIFTY has not yet and this is bearish divergence. The Daily MACD is bearish as it now trades below its signal line.

On the derivative front, the NIFTY March futures have shed over 10.66 lakh shares or 4.09% in Open Interest. This clearly suggests unwinding of long positions. The NIFTY PCR stands at 0.92 as against 0.98 a day before.

Coming to pattern analysis, the Markets have reacted sharply after touching its upper rising trend line. However, even after yesterday’s downside, the Markets still continues to remain in overall rising channel. Further, it has attempted to take support at a minor rising support line. We can expect to see some stability coming in here. However, if the Markets see some more weakness, the possibility of the Markets testing the 50-DMA OR the 8640 levels cannot be ruled out. However, even if these levels are tested, the Markets would continue to remain in broad consolidation zone.

Overall, the Markets continue to remain in broad consolidation / corrective range. Today as well, though we can see some stability returning to the Markets, runaway pullback may not be expected. Volatility too would remain ingrained in the Markets. While some fresh but very selective purchases may be made, we continue to reiterate to approach the Markets with caution while attempting to keep exposures at moderate levels.

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, March 9, 2015

Daily Market Trend Guide -- Monday, March 09, 2015

MARKET REPORT                                                                                    March 09, 2015
The Markets had an curtailed week as the Markets were closed on Friday on account of Holi. On Thursday, the Markets continued to fiercely consolidate and ended the day with minor gains after a volatile session and recovery from lower levels. The Markets saw a modestly positive opening and after that though it dipped briefly in to the red, remained flat and traded in a very narrow and capped range. The afternoon trade saw the Markets weakening further as it went on to shed some more and went on to form the day’s low of 8849.35. However, again, the second half of the session saw a very smart recovery coming in from lower levels. The Markets not only recouped all of its losses to trade back into the green but also went on to trade in positive territory. It further went on to post the day’s high of 8957.55 recovering more than 100-odd points from the low point of the day. Markets finally ended the day at 8937.75, posting minor gains of 15.10 points or 0.17% while forming a lower top and lower bottom on the Daily Bar Charts.


MARKET TREND FOR MONDAY, MARCH 09, 2015
The Markets would open today after a long weekend and they are likely to open on a lower note. Expect the Markets to open on a lower note today. The reason would be primarily weak technicals as the Markets have resisted to its upper rising trend line and another would be possibility of early rate hike from US. However, even with lower opening which is primarily because of weak technical factors will keep the overall trend intact as of yet.

The levels of 9010 and 9119 would act as immediate resistance levels for the Markets. The supports would come in at 8850 and 8790 levels.

The RSI—Relative Strength Index on the Daily Chart is 60.6341 and it remains neutral showing no bullish or bearish divergence or failure swings. The Daily MACD remains bullish as it is  trading above its signal line.  On Candles, A bullish harami occurred (where the current small white body is contained within an unusually large black body).  During a downtrend this pattern implies an end to the decline as the bears appear to have exhausted themselves. During an uptrend (which appears to be the case with NIFTY) the bullish harami pattern is bearish as the bears appear to be gaining strength as the bulls weaken. However, this needs confirmation.

On the Weekly Charts, Weekly RSI is 69.2644 and it does not show any failure swings. However, NIFTY has formed a fresh 14-period high whereas Weekly RSI has not and this is Bearish Divergence. The Weekly MACD remain bullish trading above its signal line.

On the derivative front, NIFTY March futures have further shed over 8.09 lakh shares or 3.01% in Open Interest. This signifies reduction / unwinding in positions and also some short covering from lower levels on Thursday.

Coming to pattern analysis, apart from news flow of sooner-than-expected rate hike from US, the pattern analysis clearly suggests the Markets to see some correction and broad consolidation at current levels. On the Daily Chart, it has resisted to the upper rising trend line at 9119 which is even bit higher today. The same has been the case on Weekly Charts as the Markets have resisted to the upper rising trend line. It would be completely fine and acceptable that the Markets see some mild paring of gains and broad range bound consolidation from here on. Even if it does so, it would keep its original uptrend intact.

Overall, we continue to reiterate to refrain from over exposure in the Markets. All up moves in the Markets from hereon should be used to protect existing profits and positions. Stock specific performance would continue as we will see good quality midcaps outperforming. Sectoral out performance will also be seen. Overall, cautious outlook 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