Monday, January 14, 2013

Daily Market Trend Guide -- Monday, January 14, 2013

MARKET TREND FOR TODAY                                                                  January 14, 2013
The session on Friday remained with that of mixed performances as even after over 16% rise in INFY, the NIFTY still continued to shed weight for the entire session to end the day with modest losses. Had that been not because of gains in INFY, we would have seen further deep cuts in the Index. The Markets opened on a positive and stronger note and gave its intraday high of 6018.85 in the very early seconds of the day. Thereafter, it immediately transformed itself into falling channel and remained in such trajectory for the rest of the entire session. The Markets kept paring gains and towards the end, even went on to dip in the red to give the day’s low of 5940.60, testing its very important support levels. It finally ended  the day at 5951.30, posting a modest loss of 17.35 points or 0.29% forming a higher top but moderately lower bottom on the Daily High Low Charts.

Today’s session is likely to turn out to be a very important session for the Markets. A moderately positive opening is expected but.  It would be critically important for the Markets to maintain the levels above 5950 in order to avoid further weakness. The intraday trajectory would be therefore important and the behaviour of the Markets vis-à-vis the levels of 5950 would be critically important. 

For today, the levels of 6020 and 6045 would continue to act as immediate resistance levels and the levels of 5950, and 5910 shall act as immediate supports.

The RSI—Relative Strength Index on the Daily Chart is 56.3683 and it is neutral as it shows no negative divergences or failure swings. The Daily MACD continues to remain bearish as it trades below its signal line.

On the derivative front, NIFTY January Futures have continued to shed over 4.06 lakh shares or 2.52% in Open Interest and this is certainly not a good sign for the Markets. The NIFTY PCR stands unchanged at 1.04. It would be critically important to see if we see fresh buying coming out at these levels later today.

As mentioned earlier, the Markets have taken support at 5950 at Close levels. These are the levels from where the Markets made an upward breakout after resisting for couple of weeks. It would be therefore important for the Markets to take support at these levels. Any movement below this can inflict further short term weakness in the Markets. Today, the Markets are also likely to react to the Inflation numbers coming in and also to the TCS numbers which are slated to come out later today.

All and all, the Markets still remains critically poised. Though there is no any break down on the Daily Charts, maintenance of  certain levels for the Markets as mentioned would be critically important. It is advised to still continue to refrain from shorts and at the same time remain ultra selective while taking fresh positions. Over exposure should be avoided. Cautious outlook is advised for today.

Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331


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