Friday, September 15, 2017

MARKET OUTLOOK FOR FRIDAY, SEP 15, 2017

MARKET OUTLOOK FOR FRIDAY, SEP 15, 2017
The Indian Equity Markets consolidated on expected lines of Thursday as the benchmark Index NIFTY50 remained in a narrow range and lacked any specific directional bias. The NIFTY ended the day with negligible gains of 7.30 points or 0.7%. On Friday, we expect a quiet start and expect the NIFTY to continue to consolidate. Though there may not be any major downsides, the zone of 10130-10150 will continue to pose stiff resistance to the Markets. In the coming days, we expect the Markets to oscillate in a defined range. Though any major downsides and structural breach are unlikely, NIFTY will also not show any runaway rise significantly beyond its life time highs.

The levels of 10140 and 10195 will continue to act as immediate resistance levels for the Markets. The supports will come in at 10050 and 9975 zones.

The RSI—Relative Strength Index on the Daily Chart is 62.3038 and it stays neutral showing no divergences against the price. The Daily MACD is bullish while trading above its signal line but it has flattened its trajectory.

The pattern analysis show that the though the Markets continue to remain the multi-month upward rising channel, of late it has been struggling in a very narrow range near the upper Bollinger band. The major supports that the Markets have are the 20-DMA and the 50-DMA which remain in extremely close vicinity.

Overall, we feel that some consolidation is likely to continue with some more amount of volatility remaining ingrained in it. High levels of PCR (Put to Call Ratio) and some signs of fatigue on the lead indicators are expected to keep Markets under check and keep them in a broad range bound consolidation. In the given circumstances, while continuing to make purchases with all dips, vigilant protection of profits will be necessary as well 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  

Thursday, September 14, 2017

MARKET OUTLOOK FOR THURSDAY, SEP 14, 2017

MARKET OUTLOOK FOR THURSDAY, SEP 14, 2017
We had mentioned the level of 10130 to potentially act as a serious resistance to the Markets on Wednesday. The benchmark NIFTY50 opened on a subdued note but got stronger as the session progressed marking the high at 10131.95 and came off nearly 70-odd points from the high of the day to Close with minor loss of 13.75 points or 0.14%. Today on Thursday, we expect a quiet start to the Markets. We expect the Markets to consolidate and remain vulnerable to profit taking bouts but inherent bias will continue to remain positive. Large numbers of shorts that are seen are likely to keep any corrective downsides limited.

The levels of 10130 will continue to act as resistance level along with 10185. The supports exist at 10025 and 9960 zones.

The Relative Strength Index – RSI on the Daily Chart is 61.8782 and remains neutral showing no divergences against the price. The Daily MACD stays bullish while continuing to trade above its signal line. No significant formations were seen on Candles.

The pattern analysis show that the NIFTY has successfully broken out of the congestion zone that the Index had created over past couple of days. The NIFTY continues to trade comfortably in the multi-month upward rising channel.

All and all, the NIFTY PCR too remains near recent highs. The Markets remain vulnerable to profit taking bouts from higher levels but the large number of shorts that exist in the system shall keep the downsides limited. We recommend refraining from creating short positions as short trap may occur at lower levels. Markets are likely to continue to consolidate with positive bias. We continue to recommend making select purchases with each downside while maintaining cautiously positive outlook for the day.

Milan Vaishnav, CMT 
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
Associate International Member:
Society of Technical Analysts (STA), UK  


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

MARKET OUTLOOK FOR WEDNESDAY, SEP 13, 2017

MARKET OUTLOOK FOR WEDNESDAY, SEP 13, 2017
While trading perfectly on analyzed lines, the Markets ended yet another day on Tuesday on a buoyant note. The benchmark NIFTY50 opened strong, and got even stronger as the day progressed and ended the session on a strong note gaining 87 points or 0.87%. The structural set up continues to remain favorable and the Indian Markets remain technically better poised to continue with the present momentum. We expect a positive opening on Wednesday and expect a resilient trade. The Index is likely to continue to advance and later consolidate once again at higher levels.

Wednesday will see the levels of 10130 and 10215 as a possible resistance levels. The supports will come in at 10030 and 9950 levels.

The Relative Strength Index – RSI on the Daily Chart is 63.1246 and it has marked a fresh 14-period high which is bullish. The Daily MACD continues to trade above its signal line and remains bullish as well. Another rising window has occurred on the Candles. This is essentially a gap and strongly implies possibilities of continued up move.

The pattern analysis has confirmed the 50-DMA as the immediate most important pattern support for the Markets. The NIFTY consolidated around those levels and has strongly rebounded from that support zone.

All and all, the F&O data too indicate that there are strong chances that the Markets continue with its rally on Wednesday. It is very much likely that the Index may try and test its previous highs and attempts to move past them. In the same breath, we also expect that some amount of profit taking or some ranged consolidation too cannot be ruled out. We expect stock specific out-performance to continue and recommend continuing making fresh purchases on select sectors. Positive outlook is advised for today.

Milan Vaishnav, CMT 
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
Associate International Member:
Society of Technical Analysts (STA), UK  


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

MARKET OUTLOOK FOR TUESDAY, SEP 12, 2017

MARKET OUTLOOK FOR TUESDAY, SEP 12, 2017
In our yesterday’s note, we had mentioned about distinct possibilities of the benchmark NIFTY50 due for a decisive move. In line with this analysis, the Markets opened positive, got stronger during the day on Monday, and finally ended the day with decent gains of 71.25 points or 0.72%. In high probability, we expect a positive start to the Markets on Tuesday and we expect the Index to advance its up move. In absence of any negative overnight news flow, the NIFTY will continue to the process of strengthening itself.

The levels of 10065 and 10150 will likely act as resistance levels for Tuesday. Levels of 9965 and 9910 will act as likely supports.

The Relative Strength Index – RSI on the Daily Chart is 58.1749 and it does not show any divergence against the price. RSI has marked a fresh 14-period high which is bullish. The Daily MACD stays bullish while trading above its signal line. On the Candles, a rising window occurred. This is essentially a gap on the upside and in most cases results into continuation of uptrend.

The pattern analysis show that the Markets are attempting to break out on the upside from the narrow consolidation area that it has formed over past couple of days. While doing so, it continues to trade comfortably in the upward rising channel that it has formed over past couple of months.

The Markets have attempted to up move and out of the congestion zone with higher volumes. Further to this, the up move has come with an increase in Open Interest which shows addition of fresh longs. We expect the buoyant undercurrent to continue. It is expected that while the Markets make an advance, it will also continue to see mild profit taking bouts at higher levels. We recommend continuing to make select stock specific purchase while remaining vigilant at higher levels. Positive outlook is advised for the day.

Milan Vaishnav, CMT 
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
Associate International Member:
Society of Technical Analysts (STA), UK  


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

Monday, September 11, 2017

MARKET OUTLOOK FOR MONDAY, SEP 11, 2017

MARKET OUTLOOK FOR MONDAY, SEP 11, 2017
The Markets had a relative quiet session on Friday as after opening on a higher note, it remained in a range and ended the day with modest gain of 4.90 points or 0.05%. The benchmark NIFTY50 has continued to remain under stiff congestion area and it continues to consolidate. On Monday, we expect a modestly positive start to the Markets. It is important to note that the NIFTY has added lot of short positions in last couple of days. Further, given the fact that the NIFTY has been trading in a congestion area for quite a long time, it is due that it makes a decisive move on either side in coming days.

The levels of 9930 and 10060 will act as immediate resistance levels while supports will come in at 9905 and 9850 zones.

The Relative Strength Index – RSI on the Daily Chart is 53.4201 and it remains neutral showing no divergences against the price. Daily MACD still continues to remain bullish as it trades above the signal line. No significant formations were observed on Candles.

The pattern analysis show the NIFTY trading well within the rising channel that it has formed over last couple of months. However, a stiff congestion area has been formed and there are indications that NIFTY is likely to make a decisive sharp move over coming days.

As of today, the Index continues to trade above all of its moving averages. Further, there is evidence of fresh shorts in the system as the premium in the September series contracted noticeably. With the Index currently above all of its moving averages and no evidence of any structural weakness on the Charts, there are bright chances that the Markets continue to maintain positive bias in coming days. We continue to recommend making select purchases with even corrective move that the Markets make.

Milan Vaishnav, CMT 
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
Associate International Member:
Society of Technical Analysts (STA), UK  


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

Sunday, September 10, 2017

WEEKLY MARKET OUTLOOK FOR SEP 11 THRU SEP 15, 2017

WEEKLY MARKET OUTLOOK FOR SEP 11 THRU SEP 15, 2017
Our previous Weekly Outlook mentioned all possibilities of the NIFTY not racing towards its highs too soon and not showing any major downsides as well. Very much in line with this analysis, the benchmark NIFTY50 spent the entire Week that has gone by trading in a very narrow and defined range and not making any meaningful headway. It ended the Week with net loss of 39.60 points or 0.40% on a Weekly basis. We expect a subdued start to the Week on Monday. We expect the coming week to remain range bound we will see NIFTY struggling to scale fresh highs. Despite few sectors which are likely to distinctly out-perform, slightest of the negative trigger will see the NIFTY testing its previous supports.

The coming Week will continue to see the levels of 9990 and 10110 acting as immediate resistance levels, supports are expected to come in at 9830 and 9750 levels.

The Relative Strength Index – RSI on the Weekly Chart is 65.4614 and it remains neutral showing no failure swings or any divergences against the price. The Weekly MACD continues to remain bearish while trading below its signal line and no divergences have been observed within the last five periods. No significant formations are seen on Candles.

The pattern analysis show the Markets trading in the upper range of the long 18-month channel that it has formed. Given the overall structure of the Weekly Charts and the pattern, the NIFTY is currently seen in a minor congestion area and showing some minor signs of exhaustion.

Overall, the coming week is also likely to see some volatility remaining ingrained in it. The NIFTY, if seen on the Daily Charts, is currently in the longest congestion period given the number of days it has been trading in a narrow range. The levels of 9860-9820 remain very critical zone for the Markets and any breach below this is likely to cause short term disruption in the primary trend. However, as of now, the primary trend remains intact. However, we would strongly recommend remaining extremely stock specific as the coming Week is expected to remain dominated with select stock specific performances.

A study of Relative Rotation Graphs – RRG show that the coming week will see distinct out-performance from METAL pack continuing. It is likely that the select stocks from NIFTY Junior (NIFTY Next 50), MIDCAP and ENERGY pocket join the party in relative stock specific out performance. No major improvement is likely from PHARMA, FMCG and BANKNIFTY which is likely to remain range bound. PSUBANKS and MEDIA will continue to show improvement in momentum in coming week. REALTY, IT, etc will continue to show relative under-performance.

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, is Consultant Technical Analyst at Gemstone Equity Research & Advisory Services, Vadodara. He can be reached at milan.vaishnav@equityresearch.asia
Milan Vaishnav, CMT
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member

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


+91-70164-32277  /  +91-98250-16331