Monday, April 11, 2011

Daily Market Trend Guide -- Monday, April 11, 2011

MARKET TREND FOR TODAY

The Markets saw some definite signs of weariness after resisting for quite long time and spending the days in sideward consolidation as it closed on Friday with modest gains and has formed higher top but sharply lower bottom on the Daily High Low Charts.Technically speaking, with the Markets closing near the day’s low, they usually tend to open and trade negative, at least in the initial trade.

With the Markets expected to open on a negative note, the trend would be dictated with the intraday trajectory that the Markets form. The levels of 5860 and 5890 shall act as resistance and the levels of 5810 an 5755 shall act as supports. The Markets hare poised at cross roads with the indicators on Daily and Weekly Charts presenting a contradictory picture, but with a downward bias.

The RSI—Relative Strength Index on Daily Chart is 63.9848 and is neutral as it shows no negative divergence or failure swings. The Daily MACD continues to trade above its signal line. But on the Candles, three black candles have continues to form and though they are not big enough to create three black crows, the steady downward pattern ins Bearish.

On the Weekly Charts, the MACD has given a buy signal as it has crossed above its signal line. The RSI too is bullish and shows positive divergence. On the other hand, on Candles, A Doji Star has occurred which often signals reversal from the top. Also, long upper shadow has occurred. This is typically a bearish signal especially when it occurs near high prices or during or immediately after a rally. Also a negative cross over of averages is reported as 100 DMA has cut 200 DMA from above.

Thus all and all, the performance of the Markets in following day or two shall decide the trend for the week and thereafter. Even with these conflicting readings, the bias remains towards downside until the levels of 5944 are breached on the upside. Thus, continuation of stock specific approach with high degree of caution is advised for today.


Milan Vaishnav,
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
+91-9825016331

milanvaishnav@mymoneyplant.co.in
milanvaishnav@yahoo.com

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