MARKET TREND FOR FRIDAY, APRIL 07, 2017
Though the benchmark NIFTY50 came off from its intraday lows
and ended flat with minor loss of 3.20 points or 0.03%, the Markets have
continued to show some halt in the momentum very much on the projected lines.
It is beyond doubts that the broader trend remains intact, some signs of
fatigue remain explicitly visible on the Charts. We may continue to see a
modestly positive opening once again but at the same time, we do not expect any
runaway rise to occur in the NIFTY. Some amount of healthy consolidation now
remains imminent.
The levels of 9290 and 9335 will act as immediate resistance
levels and the supports will come in at 9195 and 9130 levels.
The Relative Strength Index –RSI on the Daily Chart is
71.4017 and continues to trade modestly overbought. The Daily MACD stays
bullish while trading above its signal line. No significant formations are
observed on Candles.
The NIFTY April series went on to shed over 6.91 lakh shares
or 3.14% in Open Interest. This evidently shows caution at current levels.
The pattern analysis depicts an overstretched picture. Even
with the undercurrent remaining strong and buoyant, the NIFTY remains
overstretched at current levels. An up move, in this manner, can make Markets
little unhealthy and unsafe as such unabated rise also cause equally sharper
corrections even if the primary trend is not broken.
Overall, it is obvious and clear that the liquidity gush is
chasing the equities and the overall trend still remains sufficiently strong.
The present strength in the Markets is all set to take it higher but to make
the Markets safe and healthy at higher levels and to make it less vulnerable to
profit taking bouts, it is necessary that it consolidates a bit. A corrective
activity seems imminent. It may not be in the form of a major downside but can
occur in form of a range bound consolidation. With the Markets remaining
structurally intact, all corrective activities can be used to make selective
purchases.
Milan Vaishnav, CMT
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member:
Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
+91-98250-16331
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