Thursday, March 3, 2016

Daily Market Trend Guide -- Thursday, March 03, 2016

MARKET REPORT                                                                                  March 03, 2016
Markets staged yet another solid up move quite on expected lines as it opened strong, got stronger and ended yet another day with robust gains. The Markets saw a gap up opening once again. It saw itself opening with a decent gap up tracking very positive global cues and traded in a range in the early morning trade. Thereafter, it got stronger and traded nearly entire session in sideways trajectory. At no point did the Markets see any kind of profit taking or any weakness creeping. It maintained robust gains and towards the end went on to form a day’s high of 7380.35. While maintaining these levels, it finally settled the day at 7368.85 posting a robust gain of 146.55 points or 2.03% while forming a sharply higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR THURSDAY, MARCH 03, 2016
Today can be a day of possible consolidation for the Markets. The Markets may once again see a positive opening but today, it would be crucial to see if the Markets furthers its gains of consolidate at bit at higher levels. Today’s expected up move can take the Markets at 50-DMA levels and it is very much likely that it consolidate and sees minor profit taking at those higher levels. Minor amount of range bound consolidation cannot be ruled out.

For today, the levels of 7395 and 7435 are likely to act as immediate resistance levels for today. The supports come in at 7308 and 7275 levels.

The RSI—Relative Strength Index on the Daily Chart is 55.4977 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 is bullish as it trades above its signal line.

On the derivative front, the NIFTY March futures have added over 13.67 lakh shares or 7.36% in Open Interest. This very clearly indicates high addition in fresh long positions in the Markets.

Coming to pattern analysis, the Markets have given a break out above 7240 levels yesterday. The levels acted as a resistance a day before the Markets have given a upward breakout by opening above it yesterday and maintaining itself above that level. Today, with the likelihood of the Markets getting a positive opening, it is likely to advance its gains  at least in the initial trade.  With this the logical resistance that the Markets can face now is the 50-DMA which is 7434 today. There are chances that we see both – advancement from these levels; and also the Markets resisting at higher levels near its 50-DMA. In event of any consolidation of profit taking, the level of 7240 is now expected to act as support.

All and all, the Markets are likely to get a positive opening and it is likely to advance in the initial trade. However, at the same time, some amount of consolidation cannot be ruled out at higher levels. It is advised that though modest buying can still be continued, more emphasis should be laid on guarding and protecting profits at higher levels as chances of some consolidation cannot be ruled out. Overall, positive caution 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

+91-98250-16331

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