Friday, October 23, 2015

Daily Market Trend Guide -- Friday, October 23, 2015

MARKET REPORT                                                                                October 23, 2015
Keeping in line with the analysis carried out the Markets continued to consolidate as it ended the day with nominal losses after recovering from the low point of the day. The Markets saw a positive opening which was better than expected. After opening on a positive note, the Markets strengthened further to form the day’s high of 8294.40. After trading briefly in the sideways trajectory the Markets started to gradually pare its gains. By afternoon trade, the Markets had not only come off its highs but dipped into negative as well. It further went on to form the day’s low at 8217.15. Markets came off some 77-odd points from the high point of the day. However, the second half of the session saw some recovery as well. The Markets were able to recover much of its losses by the end of the trade. It finally settled at 8251.70, posting a nominal loss of 9.95 points or 0.12% while forming a parallel bar on the Daily Bar Charts.


MARKET TREND FOR FRIDAY, OCTOBER 23, 2015
Markets will open today after a holiday yesterday and on Wednesday’s session, it has held on successfully to its pattern support of 8230-40 range and have ended above that. Today, we are set to see a strong and nearly gap up opening today following positive global cues. The cues have been positive following ECB’s surprise comments while reviewing its QE in December. Leaving this apart, the Markets have been displayed resilience while consolidating in previous sessions.

For today, the levels of 8295 and 8340 will act as immediate resistance for the Markets. The Supports will come in a t8230 and 8170 levels.

The RSI—Relative Strength Index on Daily Chart is 61.3643 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, the NIFTY October futures have shed over 5.45 lakh shares or 2.78% in Open Interest. This continues to show some amount of unwinding of long positions as well as some short covering from the low point of the day. The NIFTY PCR stands at 1.05 as against 1.04.

Coming to pattern analysis, the Markets have been in congestion zone for over couple of sessions how. The levels of 8230-40 have been its important pattern support in event of any downside. If the Markets breach this support on the downside, it may slip once again in to the broad consolidation zone that it has been trading in this entire month. Keeping this aside, today’s likely gap up opening is likely to cause the Markets open near its resistance levels. It would be very much important to see if the Markets are able to maintain and capitalize on these gains. The Markets may move ahead to test its 200-DMA in short term if today’s opening gains are maintained and capitalized. Also, in the same breadth, given the F&O data, the Markets also remain somewhat vulnerable to get sold into at higher levels once again.

Keeping this in view, until the Markets gives a clear directional breakout on the upsides with good volumes and participation, all these up moves and higher openings should be primarily be used to book and protect existing profits. Going further, if any consolidation is seen then any minor dips should be bought into on a very selective basis. Shorts should be refrained from. Overall, continuance of 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, (ATMA), INDIA
www.EquityResearch.asia
http://milan-vaishnav.blogspot.com

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

Wednesday, October 21, 2015

Daily Market Trend Guide -- Wednesday, October 21, 2015

MARKET REPORT                                                                                  October 21, 2015
Very much on expected line, the Markets continued to remain in consolidation phase as it traded in a narrow range and ended the day with minor losses. The Markets saw a relatively quiet opening and spent the morning session in a quite ranged movement. At one point, the Markets saw some nominal strength coming in as it formed its intraday high of 8294.05. However, the Markets reverted back to its opening levels soon. Thereafter, for the most part of the session, the Markets were seen oscillating in a very narrow range but the second half of the session saw some rapid paring of gains. The Markets slipped and went on to form the day’s low of 8229.20. Once again, some last hour of the trade saw some recovery coming in as the Markets were seen off its lows. It finally settled the day at 8261.65, posting a minor loss of 13.40 points or 0.16% while forming a slightly higher top but lower bottom on the Daily Bar Charts.


MARKET TREND FOR WEDNESDAY, OCTOBER 21, 2015
The analysis remains more or less on similar lines once again as the Markets continues to remain in consolidation mode. With us having truncated week, (tomorrow being a trading holiday), it is likely that we will continue to see somewhat lack of volumes and participation in the Markets. The pattern resistance that the Markets were able to move past will continue to act as support and any breach of that level will take the Markets back into the big broad consolidation zone once again.

For today, the levels of 8290 and 8340 will act as immediate resistance for the Markets. The supports will come in at 8230 and 8170 levels.

The RSI—Relative Strength Index on the Daily Chart is 62.1962 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 Candles, a Engulfing Bearish Pattern has occurred. This since formation has occurred after a significant up move / pullback; it is likely to keep the Markets in congestion zone for some more time. However, this needs confirmation.

On the derivative front, the NIFTY October futures have shed over 3.44 lakh shares or 1.73% in Open Interest. This figure is little discouraging is it shows some offloading of positions having taken place.

Having a look at pattern analysis, the Markets have managed to keep is head above important resistance levels of 8320-40.  These are the levels that the Markets managed to move past in previous sessions and having done this, these levels are expected to act as support in event of any further congestion / consolidation. It would be important to see that the Markets remain above these levels. Any breach in these levels on the downside will take the Markets back in to the broad consolidation zone and will diminish the chances of any significant and sustainable up move.

Overall, the Markets will see a subdued and quiet opening and will require good amount of involvement / participation for a proper up move. Until this happens it will continue to oscillate in the congestion zone. It would be also important for the Markets to maintain levels above of 8340 to avoid any further weakness. With the Markets not taking any proper convincing directional call, we continue to reiterate our advice of refraining from creating shorts and making selective but limited purchases with any available dip. Overall, cautious 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

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



Tuesday, October 20, 2015

Daily Market Trend Guide -- Tuesday, October 20, 2015

MARKET REPORT                                                                                    October 20, 2015
The Markets attempted to break out of the congestion zone yesterday as it made a feeble attempt to move past the resistance zone and end the day with modest gains. The Markets saw a positive and better than expected start but after a positive start; it soon drifted to its previous close levels and traded flat. The Markets spent most part of the session in a sideways trajectory trading in a narrow range while it formed its day’s low of 8239.20. Markets continued to trade sideways but it was the second half of the trade once again that saw some strength coming in. The Markets gained some strength and formed its intraday high of 8283.05. Some more sideways movement came in, the Markets more or less maintained these levels and finally ended the day at 8275.05, posting a net gain of 36.90 points or 0.45% while forming a higher top and higher bottom on the Daily Bar Charts.


MARKET TREND FOR TUESDAY, OCTOBER 20, 2015
Markets continue to poise them at a critical juncture as it is made a feeble attempt to move out of the congestion zone. Today, we can expect the Markets to open on a modestly positive to flat note and then look for directions. There are chances that the Markets continue to consolidate at higher levels rather than giving a runaway rise. The intraday trajectory that it forms post opening would be crucial to determine the trend for today as well as for immediate short term.

For today, the levels of 8290 and 8330 will act as immediate resistance for the Markets. The supports come in at 8240 and 8180 levels.

The RSI—Relative Strength Index on the Daily Chart is 63.2688 and it has reached its highest value in last 14-days which is bullish. It does not show any bullish or bearish divergence. The Daily MACD remains bullish as it trades above its signal line.

On the derivative front, the NIFTY October futures have shed over 3.90 lakh shares or 1.92% in Open Interest. This shows some unwinding of positions at higher levels and may cause the Markets to remain in consolidation zone for some more time.

Coming to pattern analysis, the Markets have attempted to move past the upper boundary of the congestion zone but the attempt so far has been bit feeble. Further, it has come while shedding Open Interest and therefore it is likely that the Markets may continue to remain in consolidation zone for some more time. In the same breadth, the 8230-8240 levels which the Markets managed to move past yesterday should act as immediate pattern support. Any breach of the levels on the downside will take the Markets back into the broad consolidation zone. Therefore, it would be important for the Markets to maintain itself above 8230-8240 levels in order to just consolidate for some more time and avoid any weakness.

All and all, the Markets may open flat and see some sideways consolidation in the initial trade. However, given the structure of the technical charts, by no means are the Markets weak and they are in fact making attempts to move out of the consolidation zone that they have been trading in. In event of any more consolidation or temporary downsides, these downsides should be utilized to make  quality purchases on moderate levels while protecting profits going ahead until a clear directional breakout is achieved.

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, October 19, 2015

Daily Market Trend Guide -- Monday, October 19, 2015

MARKET REPORT                                                                                October 19, 2015
After spending nearly entire session in a sideways trajectory, the Markets saw a spurt in the late afternoon trade on Friday as it ended the day with decent gains. The Markets saw a quiet opening on expected lines and spent the first half of the session in modestly negative territory. The Markets traded modestly negative and spent nearly major part of the session in a sideways trajectory. Post opening in this manner, the Markets remained 30-odd point range, formed its intraday low of 8147.65 by afternoon but remain virtually directionless in the process as it headed nowhere. However, with inherent buoyancy coming to play, the Markets saw a sharp spurt in the final hour and half of the day. It saw a near parabolic move as it formed its day’s high of 8246.40. The Markets finally settled the day at 8238.15, posting a net gain of 58.65 points or 0.72% while forming a higher top and higher bottom on the Daily Bar Charts.


MARKET TREND FOR MONDAY, OCTOBER 19, 2015
Today’s session remain critical for the Markets. The Markets have closed a notch above its 100-DMA but very near to its upper resistance of the pattern. On the other hand, though it is attempting a further breakout, it is likely to open today on a modestly negative note. There are fair chances that the Markets opens a notch below its pattern resistance levels of 8230-8240, just near its 100-DMA and look for directions. The Markets remain inherently buoyant and it would be critically important to see if it attempts a breakout from the congestion zone today.

For today, the levels of 8230-40, and 8320 are important resistance levels for today. Supports come in at 8205 and 8130 levels.

The RSI—Relative Strength Index on the Daily Chart is 61.5743 and it has reached its highest value in last 14-days which is bullish. It does not show any bullish or bearish divergence. The Daily MACD remains bullish as it trades above its signal line. On the Weekly Charts, the Weekly RSI is 50.5474 and it remains neutral as it shows no bullish or bearish divergence or any failure swing. The Weekly MACD is bearish as it continues to trade below its signal line.

On the derivative front, the NIFTY October futures have added over 2.03 lakh shares or 1.01% in Open Interest. This portrays inherent buoyancy in the Markets. The NIFTY PCR stands at 1.01 as against 1.00.

Coming to pattern analysis, the Markets have been in the congestion zone over last fortnight after it attempted to move past its first pattern resistance. After this, it has been resisting to the upper end of the gap that it formed in the first week of September and this has been acting as its important pattern resistance for quire some time. Though the Markets have attempted to move past and break out of that congestion zone, it still trades a notch below that. Today’s modestly lower opening is likely to keep it below that resistance zone and it would be critically important to see that it moves past that resistance level in order for a fresh sustainable up move.

Overall, until the Markets moves past the levels of 8230-40 levels, it will continue to remain in this broad congestion zone. However, looking at the inherent buoyancy in the Markets, any downsides would remain resilient and it is strongly advised to refrain from creating any short positions. Downsides, if any should be used to make selective modest purchases. While protecting profits at higher levels until a clear breakout, cautious optimism 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

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