MARKET OUTLOOK FOR WEDNESDAY, JUNE 21, 2017

MARKET OUTLOOK FOR WEDNESDAY, JUNE 21, 2017

In our previous technical note, we had expected that no follow-up buying would emerge despite a relatively buoyant session on Monday. Very much in line with this analysis, the benchmark NIFTY50 headed nowhere and ended very flat on Tuesday losing 4.05 points or 0.04%. For Wednesday, we expect such tentative mood in the Markets to occur. We still do not expect any runaway rise to resume in the Markets. We expect the zones of 9700-9725 to continue to act as formidable resistance to the Markets.

The levels of 9675 and 9710 will play out as resistance levels for the Markets on Wednesday. The supports will come in at 9610 and 9550 levels.

The Relative Strength Index – RSI on the Daily Chart is 62.0304 and it remains neutral showing no divergences against the price. The Daily MACD is still bearish while it trades below its signal line. No significant formations were observed on Candles.

The pattern analysis suggests the NIFTY drifting below the rising trend line drawn from 9200 levels. In any case, so long as it maintains the levels above 9625, it will avert any downsides. However, given the rising nature of this support line, longer the Markets consolidate, longer it will take to move past its previous highs.

Overall, we still continue to reiterate our cautious view on the Markets. Lack of follow-up buying after relatively better session on Monday is enough warning that weariness still persist in the Markets. More so, the NIFTY still remains overbought on the Weekly Charts. This is enough reason for the Markets to continue to consolidate for some more time. Profits in any further up moves will have to be guarded cautiously.

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

Member:
Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA

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