MARKET TREND FOR TODAY January 04, 2013
The Markets spent yesterday’s session is what can be called
a quiet consolidation. The Markets opened on a mildly positive note, remained
in a capped range and ended the day with minor gains. The Markets, after
opening on a mildly positive note, dipped mildly into the red to give the day’s
low of 5986.55 in the very early minutes of the trade. Thereafter, it again
came back into the positive territory and remained positive throughout the
session. The Markets spent the entire session in a capped range as it gave its
intraday high of 6017. At one point of time, the Markets pared all of its gains
but climbed back to those levels again in the second half of the session. It
finally ended the day at 6009.50, posting a minor gain of 16.25 points or 0.27%
while forming a higher top and higher bottom on the Daily High Low Charts.
Today, we may again see some consolidation continue in the
Markets. The Markets are expected to open on a flat to mildly positive note and
look for directions. The intraday trajectory would be crucial. The Markets
shall continue to remain in a breakout mode until it maintains the levels above
of 5950. Minor profit taking along with positive consolidation cannot be ruled out.
For today, the levels of 6030 and 6065 would act as
resistance. The levels which the Markets broke on the upside, i.e. 5950-5940
shall continue to act as supports.
The lead indicators show a mild bias on the upside, at least
as of now. The RSI—Relative Strength Index on the Daily Chart is 67.9245 and it
has reached its highest value in last 14-days which is bullish. It does not
show any bullish or bearish divergence. The Daily MACD is bullish as it now
trades above its signal line.
On the derivative front, NIFTY Futures have shed a very
nominal 3200 shares or 0.02% in Open Interest. We can say it has remained
unchanged. The NIFTY PCR stands at 1, as against 0.99.
Going as per the Pattern Analysis, the breakout has occurred,
but we have not seen a runaway rise, as it was expected, especially after such
a strong sideward and range bound consolidation that we saw in last two months.
Though the lead indicators show a mildly bullish bias, we may continue to see
consolidation to continue with an upward bias but at the same time, minor
profit taking cannot be ruled out.
All and all, the breakout still remains in place but at the
same time, some consolidation and minor profit taking can also be seen. In this
phase, the Markets shall remain, once again in a range and some amount of
volatility shall remain ingrained in it. It is strongly suggested that profits
on existing positions should be very vigilantly protected. Shorts should be
strictly avoided and very cautious approach should be adopted while taking
fresh positions. Positive caution is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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