MARKET TREND FOR TODAY
May 28, 2012
Despite mild weakness in the Global Markets the Indian
Markets heavily consolidated with the upward bias on Friday as it ended the day
almost flat without change. The Markets opened on a negative note and gave its
intraday low of 4889.35 in the morning trade. The Markets thereafter saw some
recovery from the day’s low and trade in the green. However, no runaway rise
was witnessed as the Markets traded in extremely capped range as it gave its
day’s high of 4835.80. The heavy consolidation continued as the Markets ended
the day virtually unchanged at 4920.40 with net loss of just 1 Point. It formed
a mildly higher to and sharply higher bottom on the Daily High Low charts.
Today, expect the Markets t o open on flat to mildly
negative note and thus, consolidation is expected to continue. The Markets
shall open and trade in a capped range, at least in the initial trade and
consolidate with upward bias.
For today, the levels of 4960 and 5010 are immediate
resistance levels and the levels of 4880 and 4850 are immediate supports on the
Charts.
All lead indicators continue to remain in place. The RSI—Relative
Strength Index on the Daily Chart is 40.0114 and it is neutral as it shows no
negative divergences or failure swings. The Daily MACD is just reported a
positive crossover as it now trades above its signal line and is therefore
Bullish. On the Weekly Charts, the RSI 41.3950 and is neutral without showing
any negative divergence or failure swings. The Weekly MACD still continues to
trade below its signal line.
The Close reading of the Daily and Weekly Charts point
toward continuation of consolidation in the Markets, but with the upward bias.
The Markets will see some sustainable pullback once its moves past the levels
of 4956-4960 levels, and until then it will consolidate.
Given the Pattern Analysis of the both, the Daily as well as
the Weekly Charts, it clearly points
towards continuation of consolidation initially and thus volatility shall
continue to stay with the intraday trend remaining critically important.
All and all, the Markets have attempted to form a bottom and
is in the process of a pullback. Given this
condition on the Charts, it is strongly advised to avoid shorts and make
selective cautious purchases while continuing to protect profit at higher
levels. Positive caution is advised for
today.
Milan
Vaishnav,
Consulting
Technical Analyst,
+91-98250-16331
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