Friday, November 20, 2015

Daily Market Trend Guide -- Friday, November 20, 2015

MARKET REPORT                                                                          November 20, 2015
The Markets saw a day ended with decent gains as it opened strong, got stronger and ended the day near its high point the day with gains. Though this gains came purely on account of short covering. The Markets saw a positive opening and expected lines and more importantly maintained on those gains. It successfully capitalized on it going ahead in the session. After getting stronger in the morning trade, the Markets traded in sideways trajectory soundly protecting its gains. In the second half of the session, the Markets kept on posting gradual highs as it formed its high point of the day at 7854.90. It finally ended the day at 7842.75, posting a net gain of 110.95 points or 1.43% while forming a higher top and higher bottom on the Daily Bar Charts.


MARKET TREND FOR FRIDAY, NOVEMBER 20, 2015
Though the Markets have rebounded yesterday, the rise has come in purely on account of short covering. The Markets continue to trade in a broad range and today we can expect the Markets to open on a flat to modestly negative note. The Markets are expected to remain bit weak in coming days unless it moves out from a broad trading range that it has formed over couple of days. Today’s opening and the intraday trajectory formed thereafter will play a crucial role to determine the trend. The technical indicators and overall structure suggest some minor weakness to continue in the Markets.

For today, the levels of 7860 and 7910 will act as immediate resistance for the Markets. The supports come in at 7765 and 7680 levels.

The RSI—Relative Strength Index on the Daily Chart is 41.7189 and it remains neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD continues to remain bearish as it trades below its signal line.

On derivative front, the NIFTY November futures have shed over 9.59 lakh shares or 5.49% in Open Interest. This is a clear evidence of short covering in the Markets yesterday. The NIFTY PCR stands at 0.79 as against 0.72 yesterday.

Coming to pattern analysis, the Markets have not shown any significant pullback after forming recent lows. The pullbacks have met with subsequent selling on the other day and this phenomenon has formed a broad trading range / congestion on the Daily Charts. The Markets have certainly attempted to form a bottom but it has not confirmed it so far. Also, all the pullbacks have resulted in to heavy reduction in Open Interests. For the Markets to confirm the pullbacks, it will need up moves supported by fresh long positions. It is important to note that any short term weakness, if at all any, will increase the possibilities of the Markets testing its pattern supports of 7680.

Overall, currently the Markets continue to remain much in the no-trade zone. So far as taking a view is concerned, it is much evident that the Markets are completely lacking directional bias and are oscillating in a given zone. Though the lower levels are met with short covering, it is not being supported by buying as such. We continue to reiterate to keep the exposures very selective and limited while continuing to adopt a cautious outlook on the Markets.

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

Thursday, November 19, 2015

Daily Market Trend Guide -- Thursday, November 19, 2015

MARKET REPORT                                                                            November 19, 2015
The Markets took a bearish undertone, especially in the second half of the session as it ended the session with a decent cut. The Markets saw a quiet opening on expected lines and traded subdued and in a capped range in the morning trade. It spent the entire first half of the session was spent in the sideways trajectory trading in a very narrow and capped range. Markets headed nowhere in the first half and it just consolidated in a sideways trajectory. It was the second half that dealt a blow to the Markets. The Markets saw a sudden and sharp paring of gains in the second half and this continued until the end of the session. The Markets went on to form its intraday low of 7725.05 in the last hour of the trade. It traded sideways again and no recovery of any magnitude was seen.  Markets finally settled the day at 7731.80, posting a net loss of 105.75 points or 1.35% while forming a lower top and sharply lower bottom on the Daily Charts.


MARKET TREND FOR THURSDAY, NOVEMBER 19, 2015
Technical rebound is likely once again today after yesterday’s sharp decline. Markets are likely to open on a positive note and look for directions. The technical structure remains somewhat weak and it would be critically important to see if the Markets maintain its opening gains and capitalize on it as we go ahead in the session. Markets are not completely out of woods. Though technical rally cannot be ruled out today and in couple of days ahead, the Markets are not completely out of woods until it confirms its bottom.

For today, the levels of 7785 and 7840 will act as immediate resistance for the Markets. The supports come in at 7725 and 7680 levels.

The RSI—Relative Strength Index on the Daily Chart is 32.1928 and it does not show any failure swing. The NIFTY has formed its fresh 14-day low but RSI has not and this is bullish divergence. The Daily MACD remains bearish as it continues to trade below its signal line.

On the derivative front, the NIFTY November futures have added over 6.52 lakh shares or 3.84% in Open Interest. There has been addition in short positions with yesterday’s decline. The NIFTY PCR stands at 0.71 as against 0.72.

Coming to pattern analysis, the Markets once again moved yesterday towards one of its important pattern support levels of 7680. So far, the Markets continues to trade above this critically important support level of 7680 and today’s positive opening is likely to keep Markets well above that. The nearly oversold nature of the Markets and the immediate indications from the lead indicators suggest that the Markets will once again have relief technical rebound from these levels. However, if we extend the reading to couple of days more ahead of us, it is equally likely that the Markets once again see some selling pressure from higher levels.

Overall, technical rebound is likely but the Markets are expected to continue to remain in a broad range. It will certainly see a technical pullback and as of now it has not breached any of its important support levels as well. However, the key would be to see if the Markets build up on its opening gains. Also in coming days, it would be equally important to see if the Markets forms and later confirms its bottom. Until then, it is most likely that the Markets trade in a broad range remaining vulnerable to selling pressure 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

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

Wednesday, November 18, 2015

Daily Market Trend Guide -- Wednesday, November 18, 2015

MARKET REPORT                                                                            November 18, 2015
The Markets had a little volatile session yesterday as it oscillated in a 60-point range to finally end the day with modest gains. The Markets saw a quiet and modestly positive opening but it traded in a narrow range in the positive trajectory in the morning trade. However, the first half of the session saw the Markets drifting on the downside and by afternoon, the Markets pared all of its gains to trade in the negative territory. It went on to slide some more to form the day’s low of 7793. It was the second half of the session that saw the Markets rebounding very sharply. It not only came off its lows but traded back in positive territory. Further to this, it went on to form the day’s high of 7860.45 in the final hour of the trade. After coming off a bit from there, the Markets finally settled the day at 7837.55, posting a net gain of 30.95 points or 0.40% while forming a higher top and higher bottom on the Daily Bar Charts.


MARKET TREND FOR WEDNESDAY, NOVEMBER 18, 2015
Analysis for today remains more or less on similar lines that of yesterday. Reason being, the Markets are expected to open on a quiet note and it has been displaying lack of conviction and participation while pulling back. This may keep the Markets a range movement with some intermittent downsides as well. Today, post quiet opening, the intraday trajectory that it forms and the levels of yesterday’s low would be important to watch out for.

For today, the levels of 7860 and 7910 are immediate resistance levels for today. The supports come in at 7790 and 7745 levels.

The RSI—Relative Strength Index on the Daily Chart is 37.6376 and it remains neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD continues to remain bearish as it trades below its signal line.

On the derivative front, the NIFTY November futures have further shed over 1.56 lakh shares or 0.91% in Open Interest. The NIFTY PCR stands a t0.72 as against 0.71 levels. The reduction of Open Interest conveys one fact that there is clear discomfort in the Markets at the levels of 7750-7800 zones as it gets nearly oversold by then. However,  it also points out to a fact that the OI drops with any upside and this also shows that though the Markets are supported by short covering at the lower levels, it certainly lacks the conviction of a fresh buying.

Coming to pattern analysis, the Markets have so far held the pattern support levels of 7680 as it has attempted a rebound / pullback from 7714 levels. However, as mentioned above, the technical pullbacks have seen lower volumes and also a reduction in OI. This keeps the Markets little vulnerable to some more range bound movements and some intermitted selling bouts. However, so long as the Markets rule above 7680 levels, there wont be any significant downward breach in the Markets.

Overall, though the Markets have been little less strong that what it should have been otherwise during a technical pullback, it has not displayed any structural technical breach on the Charts. However, given the lack of conviction on the upside, we continue to reiterate to restrict fresh buying only to selected stocks and keep high vigil over existing profits, if any. 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

Tuesday, November 17, 2015

Daily Market Trend Guide -- Tuesday, November 17, 2015

MARKET REPORT                                                                         November 17, 2015
Markets saw a technical pullback, quite on expected lines as it ended the day with gains after opening on a lower note. The Markets saw a negative opening and it drifted further down in the morning trade while it formed its intraday low of 7714.15. Just when it seemed that it is yet another day of losses, the Markets reversed its trajectory and transformed itself into a upward rising channel. By early afternoon trade, the Markets had reversed and recouped all of its opening losses and traded flat. This trajectory was maintained until the end of the session as the Markets continued posting fresh intraday highs gradually. It recovered over 120-odd points from the low point of the day while it formed its intraday high at 7838.85. It came off a bit from those levels but finally settled the day at 7806.60, posting a net gain of 44.35 points or 0.57% while forming a higher top but lower bottom on the Daily Bar Charts.


MARKET TREND FOR TUESDAY, NOVEMBER 17, 2015
After attempting to form a base yesterday after being nearly oversold, the Markets are set to open once again on a positive note and look for directions. Though somewhat modestly positive opening is expected, the Markets are not completely out of the woods and have not confirmed any reversal. However, given the technical structure of the Charts, some technical relief rally is expected to continue to a modest extent.

For today, the levels of 7840 and 7885 are immediate resistance levels for the Markets. The supports come in at 7740 and 7710 levels.

The RSI—Relative Strength Index on the Daily Chart is 34.6331 and it remains neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD still continues to remain bearish as it trades below its signal line.

On derivative front, the NIFTY November futures have shed over 3.98 lakh shares or 2.27% in Open Interest. This makes fairly evident the fact that the yesterday’s rise has been primarily on account of short covering in the Markets. The NIFTY PCR stands at 0.72 as against 0.71 yesterday.

While having a look at pattern analysis, the Markets nearly approached its important pattern support levels of 7680 while it formed its intraday low of 7714 yesterday. So far, the Markets have maintained support at the vicinity of this level. Short covering saw the Markets giving a modest relief rally yesterday while holding on this support. Technical structure and the lead indicators on the Daily Chart suggest continuation of such modest technical pullback in immediate short term. However, it is important to note that the Markets have not formed / confirmed any reversal and it awaits structural confirmation for any reversal even if it continues with its up move. In event of any downsides in immediate future, the levels of 7680 would be of critical importance.

All and all, modestly positive opening is expected today and the Markets are expected to continue with its up move, at least in the initial trade. We continue to reiterate caution in the short-medium term and therefore also reiterate that exposure in the Markets should be kept limited. Given the nearly oversold nature of the Markets, shorts should be avoided and any dips should be utilized to make modest purchases. Overall, continuance of caution is advised in the Markets.

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