Thursday, July 7, 2016

Daily Market Trend Guide -- Thursday, July 07, 2016

MARKET TREND FOR THURSDAY, JULY 07, 2016
The Markets took a breather after six-day rally and ended the day with modest gains after a range bound but volatile trade. The Markets are expected to open on a flat note today and look for directions. Though the Global Markets remain positive, we are likely to see a flat opening as we would adjust with yesterday’s trade when we had a trading holiday. However, in case, consolidation is likely to continue in the Markets and it would continue to give health to the current rally as well.

Today, the levels of 8380 and 8400 will act as immediate resistance for the Markets. The supports come in at 8320 and 8275 levels.

The RSI—Relative Strength Index on the Daily Chart is 62.0939 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 July futures have shed over 1.51 lakh shares or 0.79% in Open Interest. There was bit of long unwinding / profit taking witnessed today. The NIFTY PCR remains unchanged at 1.04.

Coming to pattern analysis, after returning back into the rising channel drawn from February lows, the Markets achieved a breakout moving past its immediate past top of 8295 levels. The Markets not only recovered more than it lost on June 24th but also went on to give a breakout on the upside as well. After six days of gains, and moving up nearly 400-odd points in previous seven sessions, the Markets took a breather yesterday and showed first signs of consolidation on Daily Charts. The Markets are well within its rising channel and today as well, if it continues to consolidate, it would be healthy for the Markets in the long run.

This keeps our analysis on similar lines today as well. The Markets will trade in a capped range and are also expected to remain volatile to some extent. The Markets,  though some extent of volatility is expected to remain ingrained in it, will continue to see some sectoral out performance today as well. It is advised to continue to use corrective dips to make selective purchases. All and all, cautious optimism is advised for the day.


Milan Vaishnav, CMT
Technical Analyst

Member: Market Technicians Association, (MTA), USA
Member: Association of Technical Market Analysts, (ATMA), INDIA

+91-98250-16331

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