Wednesday, April 26, 2017

MARKET TREND FOR WEDNESDAY, APRIL 26, 2017

MARKET TREND FOR WEDNESDAY, APRIL 26, 2017
Domestic Equity Markets had yet another buoyant session as the benchmark NIFTY50 ended the day with decent gains of 88.65 points or 0.96%. As evident from the Charts, NIFTY has broken out from the corrective channel that it had formed while closing at its lifetime highs. At this juncture, we wish to draw attention to few important factors. Though we may see a positive start to the Markets on Wednesday, this is the time that we may obviously not sell the Markets given the very strong primary uptrend but this is certainly the time when we have to now focus and lay our utmost emphasis on protecting profits. The developments in the US given the proposed tax breaks are likely to instill volatility in the equity markets in general over coming days.

The 9315 and 9345 levels are likely to act as immediate resistance while supports come in much lower at 9250 and 9175 levels.

The Relative Strength Index – RSI on the Daily Chart is 66.6009 and throws up Bearish Divergence against the price showing tiredness in the Markets. The MACD is still bearish while trading below its signal line. On Candles, a rising window (a gap) occurred. Though this is bullish, it may not realize its full potential given the tiredness of the lead indicators.

The pattern analysis shows very clearly that the NIFTY has broken out of a small corrective channel which was formed within a primary uptrend. The breakout has expectedly occurred in the direction of the major trend. There are chances that the Markets consolidate and fill up the gap it has created before moving upwards.

All and all, with the primary trend remaining intact, we very explicitly recommend not to throw caution into the air. The tax breaks proposal in the US is likely to instill volatility in the global markets and cause some likely spikes in the US Bond Yields. Also, the lead indicators on the current charts show some tiredness and therefore there are chances we may see some volatility ingrained in our markets as well. Being the penultimate day of expiry, the session is also likely to remain dominated with rollover centric activities. Cautious approach is advised for the day.

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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