MARKET TREND FOR TODAY
March 22, 2013
What seemed to be a smart resilient pullback for the Markets
in the first half of the session, turned out to be an disappointing second half
as the Markets saw some selling pressure coming in once again as it continued
to end the day with modest losses extending losses for the third day in a row.
The Markets opened positive on positive global cues and after trading briefly
into positive, dipped into the red briefly. However, it came back into the
positive territory and kept making gradual highs as it went on to give the day’s
high of 5757.75. However, it was then, in the second half of the session where
the weakness crept in once again. The markets pared all of its gains and even
went back into the negative territory. It came off over 110 points from its day’s
high as it gave its intraday low of 5647.95. It finally ended the day at
5658.75, posting a net loss of 35.65 points or 0.63% while forming a higher top
but lower bottom on the Daily High Low charts.
Today would be an important session for the Markets. We are
likely to see some flat to mildly negative opening again in the Markets. It
would be important to see if the Markets remain in positive rising trajectory
after opening otherwise any dip below 5640-5625 can make the Markets
momentarily weak. Intraday trajectory would b e crucial to watch out for today.
The levels of 5640 and 5620 levels would be important
support levels for the Markets today to watch out for.
The lead indicators show some resilience is likely in the
Markets today. The RSI—Relative Strength Index on the Daily Chart is 34.0527
and it does not show any failure swings. However, NIFTY has made a new 14-day
low but RSI has not and this is Bullish Divergence. The Daily MACD, however,
still continues to trade below its signal line.
On the derivative front, NIFTY March futures have further
shed over 6 lakh shares or 4% in open interest. However, April month has added
over 16% in open interest. This shows rollovers have begun and the figure
should not be read singularly as unwinding of positions.
All and all, going by the pattern analysis, it is important
to see that the Markets do not dip below 5640-5620 levels significantly. This
will induce some temporary weakness in the Markets, however, it would also take
Markets towards oversold levels.
All and all, such volatile movements in the Markets is
likely to continue, but there are also come chances that we see resilience in
the Markets at lower levels. Aggressive positions should be avoided even if some selective out performance is
seen. Cautious outlook is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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