MARKET TREND FOR TODAY March 26, 2012
The Markets had an extremely volatile session on Friday as it remained in arrange for the half of the session and then perked up to end the day with decent gains. The Markets opened on a moderately positive note as expected but traded volatile in a capped range until later morning trade. However, in the second half of the session, the Markets saw support coming in at levels mentioned in our Friday’s edition of Daily Market Trend Guide as it saw a sharp pullback. The Markets went on to give the day’s high of 5312.Though it came off a bit in the last half hour of the trade and ended the day at 5278.20, posting a gain of 49.75 points or 0.95%. With this, it has ended the week with net loss of 39.75 points or 0.69%, while forming a higher top but lower bottom on the Daily High Low Charts.
For today, the Markets are expected to open on a moderately negative note and look for directions. The Markets have ended the day on Friday near their support levels and thus the volumes and the intraday trajectory that it forms shall continue to play the critically important role for the day as well as for the coming week.
For today, the levels of 5280, which is the 50-DMA for the Markets should act as support at Close levels. Any breach below that will have the Markets find support at 5205 levels and then at 200-DMA.
All lead indicators continue to remain in place on both Daily and Weekly Charts. The RSI—Relative Strength Index on the Daily Chart is 47.4720 and is neutral as it shows no negative divergence or failure swings. The Daily MACD continues to trade below its signal line. On the Weekly Charts too, the RSI is neutral as it shows no negative divergence or failure swings. The Weekly MACD is bullish as it trades above its signal line.
F&O data continue to show divergent trends which NIFTY futures shedding over 16 lakh shares in total Open Interest while stock futures adding over 18 lakh shares. This signifies that there has been some short covering in the NIFTY Futures and some fresh longs seems to have been added in the stock futures. NIFTY Short covering needs to be replaced with the longs in order to sustain Friday’s pullback.
All and all, the Markets are overall expected to trade in a broad range with the levels of 5205 and 5150 acting as lower band of the broad trading range. There is still no structural breach on the Charts and thus, it is strongly advised to refrain from shorts. Also, this being an expiry week, the Markets may continue to see volatility. Stock specific action would be seen and thus longs should be taken on very selective basis with vigilant protection of profits at higher levels. Overall, positive but cautious approach is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.