MARKET TREND FOR TODAY
February 28, 2013
Yesterday’s session remained more or less on expected lines
as the oversold Markets attempted a pullback and at the same time the levels of
5810 continued to act as resistance but still the Markets ended the day with
decent gains. The Markets opened on a
moderately positive note and after briefly trading positive; it dipped into the
red to give the day’s low of 5749.70. However, it then transformed itself into
rising trajectory and reversed the trend. It came back into the green and kept
moving upwards in rising channel. It went on to give day’s high of 5818.20 in
the late afternoon trade. The Markets hovered around those levels, came off a
bit and finally ended the day at 5796.90, still posting a decent gain of 35.55
points or 0.62% while forming a lower top and similar bottom on the Daily High
Low charts.
Today would be the most critical session for the Markets
today. We have our most important external event, Union Budget, coming up today
and we also have expiry of the current derivative series today. Expect the
Markets to open on a positive note and move in a capped range for the first hour and half of
the trade. It shall start reacting as Budget proposals come up. The volatility
is imminent today and the sustenance of the Markets above the levels of 5810 would
be of critical importance.
For today, the levels of 5810 and 5865 shall act as
immediate resistance for the Markets. The supports come in much lower at 5740.
The lead indicators are neutral. The RSI—Relative Strength
Index on the Daily Chart is 34.6981 and it is neutral as it shows no bullish or
bearish divergence or failure swings. The Daily MACD is remains bearish as it
continues to trade below its signal line.
On the derivative front, NIFTY and stocks continues to
witness heavy rollovers and most of the rollovers happened on the long side as
it added in total open interest. Fundamentally speaking, we have discounted
most of the negatives in the correction that we saw in the month of February.
The Markets are bound to remain volatile and shall keep
giving knee jerk reactions to the budget proposals as we go in further into the
session. However, the Markets will take a fundamental call, but at the same
time the down side in the Markets would be limited given the overall technicals
and the F&O statistics.
All and all, unless some drastically negative comes in, we
will continue to see range bound movements with knee jerk reactions ingrained
it. But with the scenario, we would continue to advice to refrain from building
any shorts. Any downside that may follow should be used in making high
selective purchases as sectoral out performance would be seen. Overall,
cautious approach with tinge of positive optimism is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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