Gemstone Equity Research & Advisory Services: 7/12/15

Friday, July 17, 2015

Daily Market Trend Guide -- Friday, July 17, 2015

MARKET REPORT July 17, 2015

The Markets had a steady session once again and it ended yet another day with decent gains though it did resist to its intraday resistance levels in the first half of the session. The Markets saw a better and positive opening and soon after opening it traded with decent gains in the morning session. These gains, however, remained capped and sideways as the Markets continued to resist to the levels of 8561 in the first half of the session. Though the Markets did not correct and after spending the first half of the session in sideways trajectory, it gained further strength in the second half. It went on to form the day’s high of 8616.10 by late afternoon trade. These levels were maintained and no major retracements were seen. The Markets finally ended the day at 8608.05, posting a decent gain of 84.25 points or 0.99% while forming a higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR FRIDAY, JULY 17, 2015

The Markets are likely to see a quiet and positive opening again and look for directions at least in the initial trade. The lead indicators suggest that the Markets are likely to continue with its overall up move and continue to surge upwards in coming sessions. However, the F&O data also suggest that we may see some consolidation coming in at higher levels even if the undercurrent remains buoyant.

The levels of 8630 and 8675 would act as immediate resistance levels whereas supports come in at 8560 and 8510 levels.

The RSI—Relative Strength Index on the Daily Chart is 65.4999 and it has reached its highest value in last 14-days which is bullish. It does not show any bullish or bearish divergence as such. The Daily MACD continues to remain firmly bullish as it trades above its signal line.

On the derivative front, the NIFTY July futures have added further over 7.95 lakh shares or 3.88% in Open Interest. This figure firmly suggest good amount of long positions to have been added and it also suggest clear continuation of uptrend in the immediate short term.

Coming to pattern analysis, the Markets confirmed its bottom and have moved past all of its 3 moving averages. It had remained in a intermediary downtrend in the last quarter but now it has attempted to move back into its primary trend. So long as the Markets continues to trade above its 100-DMA, we will see strong undercurrents and the overall buoyancy would prevail. In event of any consolidation or in event if the Markets breach its 100-DMA, it would see itself again in a broad consolidation zone.

Overall, the Markets are likely to see a stable opening and is likely to trade steady at least in the initial trade. All indicators as suggest clear possibility of the Markets extending its gains. However, today and in next few sessions to come, we will have to guard against consolidation from higher levels, which would otherwise be healthy for the Markets in the long run. Overall, positive outlook is advised for the day.

Milan Vaishnav,
Consulting Technical Analyst

Af. Member: Market Technicians Association, (MTA), USA
Af. Member: Association of Technical Market Analysts, (ATMA), INDIA
www.EquityResearch.asia
http://milan-vaishnav.blogspot.com

Consultant to:
www.MyMoneyPlant.co.in
+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com

Thursday, July 16, 2015

Daily Market Trend Guide -- Thursday, July 16, 2015

MARKET REPORT July 16, 2015

The Markets had a very steady and sturdy session yesterday as it opened into positive and ended the day with decent gains while moving past its 100-DMA as well. The Markets saw a positive opening and soon strengthened further in the morning trade. The Markets travelled into positive territory while amassing decent gains by late morning trade and thereafter spent nearly entire session in a sideways trajectory. By afternoon, the Markets went on to form the day’s high at 8531.40. These levels were sustained successfully by the end and the Markets finally ended the day at 8523.80, posting a decent gain of 69.70 points or 0.82% while forming a higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR THURSDAY, JULY 16, 2015

The Markets are likely to see a flat but stable opening today. The technical indicators suggest the Markets are likely to continue with its up move and may remain overall stable. In event of any consolidation, the 100-DMA will act as support. However, the Markets are likely to trade with upward bias. The volumes and the intraday trajectory that the Markets forms post opening would be crucial to watch out for.

The levels of 8560 and 8610 are immediate resistance levels for the Markets. The supports come in at 8460 and 8430 levels.

The RSI—Relative Strength Index on the Daily Charts is 61.3611 and it does not show any failure swings. However, the NIFTY has set a fresh 14-period high whereas the RSI has not yet and this is Bearish Divergence. The Daily MACD continues to remain bullish as it trades above its signal line.

On the derivative front, the NIFTY July futures have added further over 6.20 lakh shares or 3.13% in Open Interest. The NIFTY PCR stands at 1.14 as against 1.07.

Coming to pattern analysis, the Markets are likely to continue to remain its 100-DMA and in event of any consolidation at higher levels, the levels of 100-DMA will continue to act as support. The Markets have a minor pattern resistance at 8560 levels and we might see some minor consolidation taking place around those levels. However, the overall structure of the Markets continue to portray a bullish undertone.

Overall, the Markets might see a flat opening but is likely to remain more or less stable and might continue to trade with an overall upward bias. However, 8560 would be the levels to watch out for as the Markets may face some minor resistance and see some consolidation happening around that level. However, sectoral out performance will continue and any consolidation or minor dips can be utilized for fresh selective buying.

Wednesday, July 15, 2015

Daily Market Trend Guide -- Wednesday, July 15, 2015

MARKET REPORT July 15, 2015

Markets remained expected in a range and consolidate with the levels of 100-DMA continuing to act as resistance at Close levels. The Markets saw a negative opening but it managed to recoup its morning losses which were modest and the Markets traded flat by late morning trade. However, the Markets weakened in the early afternoon trade to slip into negative territory and it formed intraday low of 8424.10. It was the second half of the session which saw the Markets attempting to surge from its lower levels. The Markets managed to recoup all of its losses to trade flat and it even further went on to form the day’s high of 8480.25. However, weakness crept in and the Markets once again saw paring of gains from higher levels. It saw itself oscillating in a range and finally settled the day at 8454.10, posting a minor loss of 5.55 points or 0.07% while forming a higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR WEDNESDAY, JULY 15, 2015

Today remains a critically important day for the Markets. The Markets have resisted at its 100-DMA yesterday but today, we can expect the Markets to open on a modestly positive note. This positive opening is likely to see them opening above its 100-DMA levels and continue afresh with its up move after a day of consolidation yesterday. However, it would be critically important for the Markets to trade above its 100-DMA levels in order to capitalize on positive opening.

For today, the levels of 8480 and 8525 are immediate resistance levels for the Markets. The supports exist at 8424 and 8390 levels.

The RSI—Relative Strength Index on the Daily Chart is 57.4388 and it is neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD continues to remain bullish as it trades above its signal line.

On the derivative front, the NIFTY July futures have added over 2.11 lakh shares of 1.08% in Open Interest.

Coming to pattern analysis, the Markets have confirmed their bottom formation and are likely to now continue with its up move. With all global and domestic news flows in place, it is now likely to move past its 100-DMA levels as well and therefore trade above all of its three moving averages. Having said this, over coming days, the 50-DMA, which trades below the 100 and 200-DMA will also show improvement. It has already stopped falling and has started rising upward moderately. The Markets are all likely to come out of intermediate bearish trend and get back into consolidation mode once again. However, all this will hold true only if the Markets manages to keep its head above its 100-DMA levels.

All and all, the triggers are positive and going by the structure of the Chart read along with technical lead indicators, we are likely to see the Markets moving past its 100-DMA successfully. It is also more likely to sustain above that level and attempt to move past it also at Close. Modest purchases may be made and every dip should be used to make selective purchases. Still over exposure should be avoided and profits should be guarded at higher levels.

Daily Market Trend Guide -- Tuesday, July 14, 2015

Daily Market Trend Guide -- Tuesday, 14 July 2015

MARKET REPORT July 13, 2015

Technically bullish undertone gets ‘Greeced’, and bulls have a smooth run ! It was mentioned in yesterday’s Daily Market Trend Guide that the markets are in consolidation and chances of downward movement in the market are less and ranged, and the overall technical picture of the market has a bullish bias. Likewise, till mid day, the markets , after a flat opening, traded very flat till midday. Thereafter, markets reacted positively to the news of Greece bailout and staged a sharp upward movement. The sentiment got a boost to such an extent that a dampening news of poor IIP data got ignored. The strength in the market, prevailed till the close of the market.

The NSE Nifty touched a low of 8,355 in late morning deals, before surging to a high of 8,472. The Nifty eventually settled with a strong gain of 99 points at 8,460.

MARKET TREND FOR TUESDAY 14 July 2015

Today also, the markets are expected to start the day on a flat note. The consolidation , which the market was in for last few trading days had been broken upward. Nifty has crossed its major technical resistance of its 200 DMA both intraday and at close. This is bullish breakout.

But Pattern Analysis read along with Moving Averages of Daily High Low Chart of Nifty clearly indicates that even though it has given close above its 200 Day Daily Moving Average, markets need to open above its another and next resistance of 100 Day Moving Average of Nifty, which is 8454.61 as on today. The market need to open and sustain above this level for bull run to gain further momentum. If the markets move past this level, the next resistance exist at 8561. If the markets fail to move past its 100 DMA, we will see one more stage of market consolidating between its 200 and 100 DMAs.

On Candles Chart, A white body occurred as because markets closed higher than they opened.

Important Indicator MACD continues to be bullish since it is trading above its signal line. The MACD crossed above its signal line 17 period(s) ago and is not in Overbought/Oversold range. Another important Indicator RSI also does not give any bearish indications.

Thus, from Pattern Analysis, read along with the Moving Averages and the above given Indicators, it can be technically concluded that the markets have given a bullish breakout from its consolidation phase by moving past its 200 DMA, but for this momentum to gain further, it need to clear and sustain above its 100 DMA which is 8454.61 as of today. Otherwise, we will see yet another phase of consolidation between 200 DMA and 100 DMA of Nifty. Overall technical picture indicates bias towards bullishness.

For today, protect profits wherever available at higher levels. Further and fresh buying may be made once market moves above its above given technical resistances.

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