Saturday, December 30, 2017

WEEKLY MARKET OUTLOOK FOR JAN 01 THRU JAN 05, 2018

WEEKLY MARKET OUTLOOK FOR JAN 01 THRU JAN 05, 2018
After attempting a breakout from the 10490-zone and suffering a throwback later, the benchmark NIFTY50 ended the Year on a positive note on Friday. However, the Weekly gains remain modest with the Index gaining 37.70 points or 0.36% on Weekly basis. The Markets witnessed lot of oscillation in a capped range and has attempted to move out again from the stiff resistance area. While beginning a New Year and a new week on Monday, we are likely to see the Markets ushering in the New Year on a positive note. There are chances that we see a positive opening and see the Markets positively consolidating with a upward bias. If the Markets inch higher in coming week, it may test the 24-month long rising trend line going ahead.

The levels of 10590 and 10675 will play out as immediate resistance area for the Markets. Supports come in at 10410 and 10350.

The Relative Strength Index – RSI on the Weekly Charts is 65.6170. A Bearish Divergence persists on the Weekly RSI as the NIFTY has set a fresh 14-period high while RSI has not done so. The Weekly MACD stays bearish while trading below its signal line. A Spinning Top has occurred on the Candles portrays the indecisive and tentative mood of the Market participants.

The pattern analysis reveals that in event of the Markets attempting an up move, there are chances that the Markets face resistance at the 24-month old rising trend line as evident from the Charts. The way there are possibilities that the Markets may inch higher, there are equal possibilities that the Markets may face very stiff resistance in that area at higher levels.

Overall, the Week is likely to start on a quiet to mildly positive note and the NIFTY may attempt to inch higher and attempt to confirm the breakout again after suffering a throwback once. We reiterate to maintain a stock specific view as pockets of selective performance is likely to dominate the Market action. While avoiding shorts completely, it is still advised to protect profits vigilantly at higher levels while continuing to make select purchases.

A study of Relative Rotation Graphs – RRG show AUTO pack has significantly gained relative strength and momentum and is likely to relatively out-perform. The MIDCAP, MEDIA and PSU Banks along with NIFTY Next 50 will also join this relatively out-performing league of Indices. METAL and PHARMA are evidently seen losing momentum on Weekly basis and the Index overall may not perform much despite stock specific performances. ENERGY too is seen losing sheen as compared to other sectors.

Important Note: RRG™ charts show you the relative strength and momentum for a group of stocks. In the above Chart, they show relative performance as against NIFTY Index and should not be used directly as buy or sell signals.

(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research & Advisory Services, Vadodara. He can be reached at milan.vaishnav@equityresearch.asia

Milan Vaishnav, CMT, MSTA
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member

CMT Association (Formerly Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts, STA (UK)


+91-70164-32277  /  +91-98250-16331 



Friday, December 29, 2017

MARKET OUTLOOK FOR FRIDAY, DEC 29, 2017

MARKET OUTLOOK FOR FRIDAY, DEC 29, 2017
The Indian Equity Markets saw rollovers and expiry infused volatility and ended the day with a modest loss of 12.85 points or 0.12%. The benchmark NIFTY50 pared all of its gains in the last 45-minutes of trade and ended near the low point. Though there was volatility in the Markets, it was range bound volatility. The more important fact which is technically important is that the NIFTY has once again slipped below the 10490-mark and the earlier breakout attempt has subsequently failed because of lack of confirmation.

Going into trade on Friday, we can still expect the Markets to show a quiet opening and try to move past the 10490 levels again. The levels of 10490 and 10535 will act as resistance while supports come in lower at 10410 and 10350 zones.

The Relative Strength Index – RSI on the Daily Chart is 60.5969 and it stays neutral showing no divergence against the price. The Daily MACD still remain bullish while trading above its signal line. A black body has emerged on the Candles but it remains insignificant in the present formation.

The pattern analysis shows that the previous attempt of the NIFTY to break above the 10490-mark has failed given the lack of confirmation. Now, it would require to break out above  this level afresh and until this happens, the zones of 10490-10535 has become a formidable resistance for the NIFTY.

Overall, if we discount the Thursday’s volatility to be expiry-driven, it would be necessary to see that the NIFTY makes fresh attempts to move past 10490-mark. No sustainable up move shall occur until the NIFTY moves past this critical resistance zone. We reiterate our cautious view on the Markets until this occurs. Stock specific out-performance will occur. Highly stock specific and cautious view is advised for the day.

Milan Vaishnav, CMT, MSTA
Technical Analyst 
(Research Analyst, SEBI Reg. No. INH000003341)


Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK  


+91- 70164-32277  /  +91-98250-16331  

Thursday, December 28, 2017

MARKET OUTLOOK FOR THURSDAY, DEC 28, 2017

MARKET OUTLOOK FOR THURSDAY, DEC 28, 2017
What seemed to be a likely confirmation of a attempted breakout, turned out disappointing in the last hour and half of the trade as the Markets witnessed a profit taking bout from higher levels. The NIFTY pared all of its gains and finally settled the day with net loss of 40.75 points or 0.39%. The fact that was technically significant in the Wednesday’s trade what that the NIFTY has still not yet confirmed its attempted breakout. Going into trade on Thursday, the levels of 10490 shall remain critically important for the Markets.

NIFTY will have to move past and trade above 10490 to avoid any weakness. Any slip below this level will see the Markets being forced into some more corrective consolidation. The levels of 10535 and 10580 will play out as resistance levels while the supports will come in at 10440 and 10405 zones.

The Relative Strength Index –RSI on the Daily Chart is 61.7832 and it remains neutral showing no divergence against the price. The Daily MACD stays bullish while still trading above its signal line. A black body emerged on Candle. But it remains insignificant in the present scenario.

The pattern analysis clearly shows lack of confirmation of the attempted breakout. The NIFTY has taken support on the same value i.e. 10490 which is the level it attempted to breach on the upside. This level remains important and might dictate the movement of NIFTY over coming days.

We also enter the expiry day of the current derivative series and we will continue to see the session remaining dominated with rollover centric activities. Unless the NIFTY moves past the level of 10490 in a comprehensive manner, it will continue to remain susceptible to volatile profit taking bouts at higher levels. While continuing to keep exposures at very modest levels, highly cautious view is advised for the day.

Milan Vaishnav, CMT, MSTA
Technical Analyst 
(Research Analyst, SEBI Reg. No. INH000003341)


Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK  


+91- 70164-32277  /  +91-98250-16331  

Wednesday, December 27, 2017

MARKET OUTLOOK FOR WEDNESDAY, DEC 27, 2017

MARKET OUTLOOK FOR WEDNESDAY, DEC 27, 2017
After staying flat and range bound for the entire session on Tuesday, the Markets saw a sharp upsurge, more so in the final hour of the trade and as a result, the benchmark NIFTY50 ended the day with a modest gain of 38.50 points or 0.37%. The Markets have posted yet another lifetime closing high and the liquidity has not yet stopped to chase the momentum. Going into trade on Wednesday, we will see volatility creeping in as well. We enter the penultimate day of the expiry of the current derivative series and we will see activities remain heavily dominated with rollovers.

Wednesday will see Markets facing a tricky situation. A breakout has been attempted from 10490 level but we still require confirmation. NIFTY will face resistance at 10540 and 10585 levels.

The Relative Strength Index – RSI on the Daily Chart is 65.5629 and it continued to mark its 14-period high which is bullish. It does not show any divergence against the price. The Daily MACD stays bullish while trading above its signal line. A white body occurred on Candles but it shows no significant formations with it.

Pattern analysis shows an attempt to break out above the 10490 by the Markets. However, a meaningful rally is yet to happen and the Markets await confirmation for that. Daily Stochastic remains highly overbought.

Overall, Markets are demonstrating buoyant intent and we are likely to see this continuing tomorrow as well. However, with expiry approaching, it is likely that volatility will also make its presence felt. For the Markets to inch higher, it would be necessary for the Markets to trade above 10490. Any dip below this will force the Markets into consolidation once again. We recommend avoiding shorts completely. With the liquidity chasing the Markets, up moves will remain prone to likely volatile profit taking bouts from higher levels. Exposures should be continued to be kept modest and profits should be heavily protected at higher levels.

Milan Vaishnav, CMT, MSTA
Technical Analyst 
(Research Analyst, SEBI Reg. No. INH000003341)


Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK  


+91- 70164-32277  /  +91-98250-16331  

Tuesday, December 26, 2017

MARKET OUTLOOK FOR TUESDAY, DEC 26, 2017

MARKET OUTLOOK FOR TUESDAY, DEC 26, 2017
Friday’s session ended relatively on better-than-expected note as the NIFTY tested its lifetime high levels and ended at a new Closing high putting on gains of 52.70 points or 0.50%. Tuesday’s session is likely to open on a quiet note. Though Markets in general are likely to continue to show positive intent, the benchmark Index NIFTY50 still awaits a clear and clean break out on the Charts.  It is likely that the NIFTY attempts fresh highs again but in any case the levels of 10490 will continue to remain important levels to watch out for. It would be important for the Markets to remain above these levels to continue to inch higher.

The levels of 10535 and 10580 will play out as immediate resistance area for the Markets. Supports come in at 10410 and 10375 zones.

The Relative Strength Index – RSI on the Daily Chart is 63.6098 and it has marked its highest value in last 14-days which is bullish. Daily MACD continue to remain bullish while trading above its signal line. No significant formations were seen on Candles.

The pattern analysis show positive intent of the Markets on the Daily Charts. However, despite ending at fresh Closing highs, the levels of 10490 continue to pose major resistance and the Markets are seen resisting to those levels. For any sustainable up move to occur, the levels of 10490 need to be breached on the upside in a meaningful way. The lead indicators show some tiredness and this needs to be approached cautiously.

All and all, the Market breadth in the frontline Indices also remain slightly fractured. There are all chances that the Markets continue to see select out-performance from individual stocks and besides this, remain in overall consolidation. In the present setup, while we still await a clean break out, some selling pressure from higher levels cannot be ruled out. The Nifty PCR remains at elevated levels. We recommend keeping exposures at modest levels and focus on protecting profits at higher levels until a clear break out is achieved.

Milan Vaishnav, CMT, MSTA
Technical Analyst 
(Research Analyst, SEBI Reg. No. INH000003341)


Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK  


+91- 70164-32277  /  +91-98250-16331  

Sunday, December 24, 2017

WEEKLY MARKET OUTLOOK FOR DEC 25 THRU DEC 29, 2017

WEEKLY MARKET OUTLOOK FOR DEC 25 THRU DEC 29, 2017
The previous Week remained much volatile owing to outcome of Gujarat Elections but speaking on a overall note, it ended on better-than-expected note. The benchmark NIFTY50 ended with net gains of 159.75 points or 1.55% on a weekly basis. We expect this positive intent to continue but we still see all chances that the clean breakout may still await the Markets despite the Index ending at a life-time closing high. The next week remains a short week with Monday remaining a trading holiday. Next week will still remain susceptible to profit taking at higher levels as Markets awaits a clean break out. Also, bearish divergence persists on the lead indicators.

The next week will see the levels of 10535 and 10670 playing out as major resistance levels. The supports come in at 10410 and 10280.

The Relative Strength Index – RSI on the Weekly Chart is 63.6098. A bearish divergence is evident on this indicator as the NIFTY has set a fresh 14-period high while the RSI has not. Also, it has continued to form lower tops and is yet to breakout from this formation. The Weekly MACD is still bearish while it trades below its signal line. No major formations were observed on Candles.

Overall, though the Markets may have ended at a life-time Closing high, it is evident that the clean breakout is still awaited. There are two factors that would weigh against the Markets achieving a clean break out. First, in an instance the Markets inches higher, it will encounter pattern resistance of the 22-month long rising trend line. Secondly, there is clear Bearish Divergence on the lead indicators which may prevent the Markets from either giving a clean break out or from sustaining it at higher levels. Cumulatively speaking, all these factors keep the Markets still exposed to corrective profit taking bouts at higher levels. We recommend continuing to approach Markets on a cautious note with protecting profits at each higher level.

A study of Relative Rotation Graphs – RRG show that AUTO pack has shown considerable improvement in its relative performance. This is likely to continue in the coming week as well. Along with this, the MIDCAP universe is likely to outperform along with the broader markets. METAL and PHARMA are evidently losing momentum and this under-performance is likely to be seen in the coming week as well. The FMCG, REALTY, PSUBANK and MEDIA will see their select components relatively out-performing the Markets. ENERGY pack is not likely to see any major action this coming week.

Important Note: RRG™ charts show you the relative strength and momentum for a group of stocks. In the above Chart, they show relative performance as against NIFTY Index and should not be used directly as buy or sell signals.

(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research & Advisory Services, Vadodara. He can be reached at milan.vaishnav@equityresearch.asia

Milan Vaishnav, CMT, MSTA
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member
CMT Association (Formerly Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts, STA (UK)


+91-70164-32277  /  +91-98250-16331 



Friday, December 22, 2017

MARKET OUTLOOK FOR FRIDAY, DEC 22, 2017

MARKET OUTLOOK FOR FRIDAY, DEC 22, 2017
The session on Thursday remained quite lackluster as the Markets headed nowhere and spent the session in a narrow range. The benchmark NIFTY50 oscillated in a 30-point range and finally settled the day with a modest loss of 3.90 points or 0.04%. The Markets continued to consolidate and going ahead for trade on Friday, we expect this consolidation to continue. The levels of 10490-will continue to pose serious resistance and given the extended weekend this time, we will also see some cautious outlook weighing on the Markets. For any serious up move to occur, the Markets will have to take out the levels of 10490 comprehensively and this may not happen too soon too fast.

The levels of 10490 and 10535 will continue to pose serious resistance to the Markets. The Supports come in much lower at 10375 and 10280 zones.

The Relative Strength Index – RSI on the Daily Chart is 60.7827 and continues to stay neutral against the price. The Daily MACD is bullish while trading above its signal line. No significant formations were observed on Candles.

While having a look at pattern analysis, the NIFTY has comfortably moved outside the falling channel and have tested the 10490-mark on expected lines. However, given the overall structure on the Charts, we are likely to see some more consolidation happening before we see any comprehensive and sustainable breakout.

Overall, it is also worth taking note that the short term 20-DMA has cut the 50-DMA from above. The interpretation of this is that if this continues and if the 20-DMA slips significantly below the 50-DMA, it can signal loss of momentum for the Markets in the immediate short term. With Monday being a trading holiday, we are likely to see consolidation happening on a cautious note in the Markets. It is required that the Markets are approached with a highly stock specific focus and on a very cautious note.

Milan Vaishnav, CMT, MSTA
Technical Analyst 
(Research Analyst, SEBI Reg. No. INH000003341)


Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK  


+91- 70164-32277  /  +91-98250-16331  

Thursday, December 21, 2017

MARKET OUTLOOK FOR THURSDAY, DEC 21, 2017

MARKET OUTLOOK FOR THURSDAY, DEC 21, 2017
Very much as analyzed in our previous note, the benchmark NIFTY 50 did attempt to inch higher and test the 10490-mark, but it also faced stiff resistance to those levels. The Index after a marginal high saw corrective pressure in the second half of the session. The NIFTY finally ended the day with net loss of 19 points or 0.18%. Thursday’s trade is likely to remain in similar lines. The Markets may see a quiet opening and may also show some buoyant intent but the levels of 10490 will continue to post stiff resistance to the Markets and force it into some more consolidation.

The levels of 10490 and 10535 will pose resistance to the Markets on Thursday. The supports come in at 10350 and 10310 zones.

The Relative Strength Index – RSI on the Daily Chart is 61.1090 and it stays neutral showing no divergence against the price. The Daily MACD stays in buy mode while trading above its signal line. On Candles, a not-so-classical Dark Cloud occurred. The size of the candle is relatively small than what is usually required in such formation but this often reiterates the credibility of the resistance area where it occurred.

While having a look at pattern analysis, the NIFTY has managed to move out of the intermediate falling channel that it had created. However, it has inched higher but has met with a stiff resistance at its previous high. Also, the lead indicators remain neutral while marking a lower top though not confirming it.

All in all, while going into trade on Thursday, we recommend maintaining highly stock specific approach to the Markets. We will see select components from specific sectors like INFRA, MEDIA, etc. attempting to relatively out-perform. However, on a broader note, we still expect the Markets to face stiff resistance at 10490-mark despite showing buoyant undercurrent. There are all chances that the Markets may remain vulnerable to selling bouts at higher levels and be forced in consolidation for some more time. Cautious outlook is advised for the day.

Milan Vaishnav, CMT, MSTA
Technical Analyst 
(Research Analyst, SEBI Reg. No. INH000003341)


Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK  


+91- 70164-32277  /  +91-98250-16331  

MARKET OUTLOOK FOR WEDNESDAY, DEC 20, 2017

MARKET OUTLOOK FOR WEDNESDAY, DEC 20, 2017
On the expected lines, the Markets continued with their up move and had a follow-through session on Tuesday as the Index inched higher and ended the day with net gains of 74.45 points or 0.72%. The session remained within the defined parameters as the NIFTY moved closer to its life-time high level of 10490. Wednesday is likely to see a quiet to modestly positive opening. In all likelihood, the NIFTY may attempt to test 10490 levels but at the same time, it would be immensely important to observe the behavior of the Markets vis-à-vis this lifetime high level of 10490 which is likely to pose resistance to the markets.

The levels of 10490 and 10535 will play out as resistance levels for Wednesday. Supports come in lower at 10390 and 10335 zones.

The Relative Strength Index – RSI on the Daily Chart is 62.6297 and it has marked a fresh 14-period high which is bullish. The Daily MACD is bullish while trading above its signal line. No significant formations were seen on Candles.

Going by pattern analysis, the NIFTY has successfully managed to break out of the falling channel which was formed as its intermediate trend. The moving past of NIFTY significantly above 10490 would be important for a sustainable up move to occur. Until this happens, we may again see the Markets being forced into consolidation.

All and all, buoyant undercurrent may continue. However, while we approach the levels of 10490 and before a significant breakout occurs, we may see some profit taking happening at higher levels. The Markets remain vulnerable to some minor profit taking bouts and this may instill some volatility into the Markets in general. We recommend making stock specific purchases at modest levels and concentrate more in protecting profits at higher levels.

Milan Vaishnav, CMT, MSTA
Technical Analyst 
(Research Analyst, SEBI Reg. No. INH000003341)


Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK  


+91- 70164-32277  /  +91-98250-16331  

Tuesday, December 19, 2017

MARKET OUTLOOK FOR TUESDAY, DEC 19, 2017

MARKET OUTLOOK FOR TUESDAY, DEC 19, 2017
The Indian Equity Markets witnessed immense volatility on Monday as the benchmark NIFTY50 nearly swung 300-odd points on either side before settling with a net gain of 55.50 points or 0.54%. The NIFTY saw a gap down opening, directly tested the 100-DMA and then recovered form that levels once the ruling BJP showing improved margin over the Congress. The volatility was expected but the quantum remained much larger than expected. Tuesday will continue to see volatility ingrained in the Markets but may continue to trade with positive bias. The Markets witnessed huge spate of short covering from the opening lows and this is likely to see follow-up up move on Tuesday as well, at least in the initial trade.

The levels of 10435 and 10490 will act as major resistance area for the Markets. Supports come in at 10350 and then at 10275 levels.

The Relative Strength Index – RSI on the Daily Chart is 58.9091 and it has marked a fresh 14-period high which is bullish. The Daily MACD is bullish as it trades above its signal line. 
The Candles showed formation of a bullish engulfing pattern. However, the place of its occurrence makes it relatively insignificant.

The pattern analysis shows that the Markets have managed to move up of the falling channel  that it had created as a part of the intermediate trend. Further to this, the RSI has broken out from a pattern in which it was marking lower tops. All this point towards the follow up move spilling over into  Tuesday’s trade as well.

The volatility being discounted and if we look at the macro picture, the BJP’s win will not be viewed too favorably by the Markets in the long run. The method in which the BJP’s majority was dented as compared to 2012 will instill lot of caution into the Markets and will lead to volatile churning of portfolios. We may see some positive bias going into trade on Tuesday, but each moves should be used to protect profits at higher levels. Caution is advised and we expect Markets encountering resistance once again as it approaches higher levels.

Milan Vaishnav, CMT, MSTA
Technical Analyst 
(Research Analyst, SEBI Reg. No. INH000003341)


Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK  


+91- 70164-32277  /  +91-98250-16331  

Monday, December 18, 2017

MARKET OUTLOOK FOR MONDAY, DEC 18, 2017

MARKET OUTLOOK FOR MONDAY, DEC 18, 2017
The session on Friday remained much on the analyzed lines as the Equity Markets did witness buoyancy on back of exit polls outcome that reflected the ruling party BJP retaining power in Gujarat but also in the breath, the NIFTY continued to resist to the 10330-10360 zones as well. The benchmark Index spent the entire session moving in a capped range and resisting to this area. It ended with net gains of 81.15 points or 0.79%.

Monday will start a likely volatile week for the Markets. We are all likely to see a initially positive opening but as we go ahead in the session, the Markets would also react in a somewhat volatile way to the Gujarat Election results that will start pouring in as well. Any unexpected outcome may dent this move, but if nothing untoward happens on Monday, we expect the Markets to continue with the heavy short covering that it witnessed on Friday and inch higher.

The levels of 10390 and 10435 will act as immediate resistance levels for the Markets with the levels of 10160 and 10190 playing out as supports.

The Relative Strength Index – RSI on the Daily Chart is 55.8677 is neutral against the price without showing any divergence. The Daily MACD has shown a positive crossover. It is now bullish while trading above its signal line. On the Candles, a Rising Window has occurred. It has emerged after a long lower shadow and usually signals the continuation of the up move.

The pattern analysis show the Markets resisting for the entire day to the upper falling trend line of the falling channel that is created. This is the short term intermediate trend that the Markets are trading in. The RSI too has resisted to the falling trend line as it is subject to independent analysis. A breakout form this formation will precede any significant up move in prices.

All and all, heavy short covering witnessed on Friday and we expect this to continue at least in the initial trade on Monday. The session is likely to remain volatile as the Markets reacts to the Gujarat Election results. It would be important to see that to sustain, the Markets will have to trade effectively above 10360-mark and the short covering needs to be replaced with fresh buying. Positive caution is advised for the d ay.

Milan Vaishnav, CMT, MSTA
Technical Analyst 
(Research Analyst, SEBI Reg. No. INH000003341)


Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK  


+91- 70164-32277  /  +91-98250-16331