Thursday, September 24, 2015

Daily Market Trend Guide -- Thursday, September 24, 2015

MARKET REPORT                                                                                September 24, 2015
Markets fared exactly as analyzed in our yesterday’s edition as it opened much lower but recovered during the rest of the session to end the day with modest gains. The Market saw a near gap down opening following weak global cues and formed its intraday low of 7723.25 in the early minutes of the morning session. Though the Markets did spent some time trading in a sideways range but then converted itself into rising trajectory and remained so throughout the session. The Markets spent the first half of the session recovering most of its gains and traded near its previous close by then. The second half also saw the Markets strengthening further as it went on to rise and formed its intraday high of 7882.90. It came off from those levels but finally ended the day at 7845.95, posting modest gain of 33.95 points or 0.43% while forming a lower top and lower bottom on the Daily Bar Charts.


MARKET TREND FOR THURSDAY, SEPTEMBER 24, 2015
Today, we enter the expiry day of the current derivative series and just like previous two sessions, the Markets are likely to remain dominated with rollover centric activities. Speaking purely on technical terms, the Markets are slated to open on a modestly lower note and look for directions. There are chances that we may see some weakness persisting but overall, the Markets are likely to trade in a given broad range with some possibilities of volatility remaining ingrained in the Markets following rollovers.

For today, the levels of 7880 and 7930 will act as immediate resistance levels for the Markets. The supports come in at 7790 and 7730 levels.

The RSI—Relative Strength Index on the Daily Chart is 44.7841and it remains neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD remains bullish as it continues to trade above its signal line.

On the derivative front, rollovers continued as the NIFTY September series shed over 24.17 lakh or 13.61% in Open Interest. The October series added over 22.61 lakh shares or 18.46% in Open Interest. Overall, net open interest reduction of over 1.56 lakh shares was seen. This once again signifies that there was a short covering form lower level in the Markets.

Coming to pattern analysis, the Markets have attempted to form a base near 7700-levels and have attempted to pullback form there. However, it is extremely important to note that the Markets have shown just faint indication of possible bottom formation but in no way it has shown any confirmatory signs. This continues to keep the Markets in a broad trading range and also it continues to keep Markets below its key resistance zone of 7960-8000 levels. This structure on the technical chart continues to keep the Markets vulnerable to selling bouts from higher levels.

Overall, the Markets may see a stable opening and it can even see some improvement as we go ahead in the session. However, the expiry is likely to keep the Markets volatile and the technical factors will continue to keep the Markets vulnerable from sell offs at higher levels. However, given the feeble signs of bottom formation that the Markets have shown, we continue to reiterate to refrain from creating any short positions in the Markets. While utilizing downsides to make very moderate purchases, continuation of cautious approach is advised for today.

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

+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com



Wednesday, September 23, 2015

Daily Market Trend Guide -- Wednesday, September 23, 2015

MARKET REPORT                                                                          September 23, 2015
After opening stable and trading with capped gains the Markets took a terribly bearish overturn as it weakened significantly in the seconde half of the day and ended the day with deep losses. The Markets saw much better than expected opening and formed its high point of the day at 8021.60 in the early morning trade. Thereafter, the Markets traded sideways with capped gains though it never really looked weak. However, it was the second half that did most of the undoing of the Markets. The second half saw the Markets getting suddenly weak and saw a violent selling pressure. It saw a near vertical paring of gains and went on to form the day’s low of 7787.75, paring nearly 234-odd points from the high point of the day. Minor recovery was seen at all in the end and the Markets finally ended the day at 7812, posting a net loss of 165.10 points or 2.07% while forming a higher top but sharply lower bottom on the Daily Bar Charts.


MARKET TREND FOR WEDNESDAY, SEPTEMBER 23, 2015
We refer to our edition of Daily Market Trend Guide dated September 21st, wherein we had mentioned the strong possibility of the gap being filled in by the Markets. The technically weak markets retraced and yesterday filled up that gap on the downside. Today as well, we are likely to see a weaker opening in the Markets and the Markets are expected to trade with losses in the initial trade. However, we also enter the penultimate day of expiry of current derivative series and the session will remain dominated with rollovers.

For today, the levels of 7820 and 7875 will remain immediate resistance levels for the Markets. The supports will come in at 7750 and 7710 levels.

The RSI—Relative Strength Index on the Daily Chart is 43.0976 and it remains neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD stands bullish as it still continues to trade above its signal line.

On the derivative front, the NIFTY September series shed over 13.50 lakh shares or 7.06% in Open Interest whereas the October series added over 54.61 lakh shares or 80.44% in Open Interest. This figure shows a massive rollover of shorts as net addition of Open Interest by over 41 lakh shares. The NIFTY PCR stands at 0.95 as against 1.00 yesterday.

Coming to pattern analysis, we had very categorically mentioned that the upward rising gap was created on September 20th. This being a common area gap does not hold much significance on the upside and is likely to get filled. The Markets have retraced for the two days following that and has filled up that gap. The Markets are attempting to form a base around these levels. Today’s opening is likely to  be a weaker opening and baring some 50-75 odd points volatility from current levels, there are mild signs that the Markets may form a bottom and may prepare some ground work required for a sustainable pullback.

Overall, following this technical situation on the Daily Charts, as we mentioned earlier, weak opening is nearly imminent and at the same time, baring some 50-75 odd points volatility, the Markets may attempt to form a base around these levels. Given this fact, we strongly reiterate now to stay away from creating any fresh short positions. Any dip that we may see should be utilized to make fresh purchases. However, until attempts to find bottoms are seen, these purchases should be kept limited and cash should be preserved.

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

+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com


Tuesday, September 22, 2015

Daily Market Trend Guide -- Tuesday, September 22, 2015

MARKET REPORT                                                                                September 22, 2015
Markets heavily consolidated as it ended on a flat note but had to recover all of its losses post a weak and near gap down opening. The Markets saw a very weak opening as it opened nearly just less than a percent down following mixed global cues. However, post opening the Markets formed its day’s low of 7908.35 in the early minutes of the morning trade. Thereafter, the Markets remained in upward rising trajectory throughout the session. It slowly but steadily recovered all of its morning losses. Though it remained in sideways trajectory in the afternoon trade, by the end of the session, it had managed to recover all of its losses and also traded positive for a very brief period while it formed its intraday high of 7987.90. It hovered around those levels for a while and finally ended the day at 7977.10, posting a very flat close with negligible loss of 4.80 points or 0.06% while forming a lower top lower bottom on the Daily Bar Charts.


MARKET TREND FOR TUESDAY, SEPTEMBER 22, 2015
We can expect a relatively quiet opening today as the Markets are likely to open on a flat note. However, the opening levels are likely to be the near the resistance levels as evident from the Daily C hart and therefore it would be important to see the trajectory that the Markets form post opening. The F&O data suggest both volatility and the possibility of trading in a capped range. The rollovers would continue to dominate the session.

For today, the levels of 7995 and 8050 will act as immediate resistance levels for the Markets. Supports come in at 7920 and 7880 levels.

The RSI—Relative Strength Index on the Daily Chart is 49.9930 and it remains neutral as it shows no bullish or bearish divergence or any failure swings. The  Daily MACD remains bullish as it trades above its signal line.

On the derivative front, rollovers continued as the NIFTY September futures shed over 27.35 lakh or 12.52% in Open Interest whereas the October series added over 37.82 lakh shares or 125.79% in Open Interest. The NIFTY PCR stands at 1.00, remaining unchanged.

Coming to pattern analysis, as evident from the Charts, the Markets continued to resist precisely in the 7960-8000 levels. Today’s opening is likely to remain around those levels and therefore the trajectory that the Markets forms post opening would be crucial to watch out for. Having said this, on the upside, some significant pattern resistance too exists near 8050 levels as the Markets may also resist to the gap that it had created earlier which has not yet been filled in. This space can act as major pattern resistance in coming days.

Overall, keeping the overall technical structure in view, the Markets may move up to test its previous resistance levels mentioned above but may not see a very significant up move before expiry. Whereas with some space existing on the downside, the Markets still continues to remain without any directional bias and in a broad trading range. It is advised to continue to remain very moderate on exposures with highly selective approach.

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

+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com


Monday, September 21, 2015

Daily Market Trend Guide -- Monday, September 21, 2015

MARKET REPORT                                                                        September 21, 2015
Just as the Fed event was over, the Markets were taken over purely by technical factors perfectly as expected by us in the Friday’s edition. The Markets saw a gap up opening and after opening strong and positive in the morning, it strengthened further by mid session as it formed the day’s high at 8055. However, the Markets reacted precisely at the gap that it had crated while it had a gap down opening and therefore it faced a very strong resistance at that point. It not only resisted but also failed to maintain those levels. The second half of the Markets saw itself paring bulk of its gains and it again went down to trade near its pattern resistance levels / zone of 7960-8000 levels. The Markets have so far failed to fill up the break away gap it has formed and today reacted fiercely from there. It finally managed to end the day at 7981.90, posting a net gain of 82.75 points or 1.05% while forming a sharply higher top and higher bottom on the Daily Bar Charts.


MARKET TREND FOR MONDAY, SEPTEMBER 21, 2015
Though the Markets ended quite off form the high point of the day on Friday, they have once again created an “area gap”. Today, the Markets are likely to open on a modestly negative note and look for directions. The Friday’s session have seen quite large amount of short covering but at the same time, it would be equally important to see if this is followed up by fresh buying. With this being expiry week, the Markets will remain dominated with rollover centric activity with some bias towards the Markets attempting to find bottoms in this broad trading range.

For today, the levels of 7995 and 8055 will act as immediate resistance levels for the Markets. The supports come in at 7930 and 7850 levels.

The RSI—Relative Strength Index on the Daily Charts is 50.2099 and it has reached its highest value in last 14-days which is bullish. It does not show any bullish or bearish divergence on the Charts. The Daily MACD is bullish as it continues to trade above its signal line. On the Weekly Charts, the Weekly RSI is 43.1715 and it continues to remain neutral as it shows no bullish or bearish divergence or any failure swings. The Weekly MACD remains bearish as it trades below its signal line.

On the derivative front, the NIFTY September futures have added over 2.97 lakh shares or 1.38% in Open Interest. This mildly indicates majority of the shorts are being covered with some more shorts coming in above 8000-levels. The NIFTY PCR stands at 1.00 as against 0.95 on Friday.

Coming to pattern analysis, the Markets have pulled back over 500-odd points from the lows of 7539.50 that it formed on September 08th 2015. However, that being said it has continued to resist at the 7960-8000 range first and then to the “gap” that was created in the last week of August when the Markets saw a significant downsides. This breakaway gap has been a major area of resistance over and above 7960-8000 levels and the Markets have continued to resist in this area. Further, though the Markets have once again crated a higher “gap” on Friday, but this is a area gap and appeared within a formation and holds little significance. Also, it is more likely to be closed in coming session.

Overall, the Markets still continue to remain little precarious and going by the pattern analysis, some amount of weakness may still continue. Having said this, the rollovers to will effect and dominate the Markets for next couple of sessions. Also, though there are some chances of the Markets testing higher levels, it has not shown any signs so for of confirmation of bottom. Given this situation, we continue to reiterate our cautious stand on the Markets. It is advised to continue to keep purchases highly selective and limited while maintaining high degree of caution at higher levels.

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