MARKET TREND FOR TODAY
March 07, 2013
The Markets continued with its up move yesterday and also
resisted around its expected resistance levels but still ended the day with
modest gains. The Markets opened on a positive note on back of favourable global
cues and gave its intraday high of 5828.70 in the late morning trade.
Thereafter, the markets continued to trade in a capped range for the rest of
the session as it kept moving in a 20-odd points capped range. It finally ended
the day at 5818.60, posting a modest gain of 34.35 points or 0.59% while
continuing to form a higher top and higher bottom on the Daily High Low Charts.
Today, though undercurrent remains intact, we may see a
modestly negative to flat opening in the markets as there are chances that the
Markets may take some breather from the pullback that it has been witnessing.
The Markets are expected to open and trade in a capped range in the initial
trade and the levels of 5800 would be important to see if further weakness
creeps in.
For today, the levels of 5845.72, which is the 100-DMA of
the Markets is likely to act as resistance at Close and this would be the
important level that the Markets should watch out for.
The lead indicators depict a mixed picture. The RSI—Relative
Strength Index on the Daily Chart is 45.5081 and it is neutral as it shows no
negative divergence or failure swings. The Daily MACD is still bearish as it
continues to trade below its signal line.
On the Candles, A rising window occurred
(where the top of the previous shadow is below the bottom of the current
shadow). This usually implies a
continuation of a bullish trend. There
have been 4 rising windows in the last 50 candles--this makes the
current rising window even more bullish.
On the derivative front, NIFTY Futures have went on to
add over 3.29 lakh shares or over 2.01% in Open Interest and the NIFTY PCR
stands at 1 as against 0.94.
To make sense of the above reading, the Markets
certainly have a bullish undertone and though some consolidation in a capped
range cannot be ruled out, at the same time, major correction is not likely.
The Markets may spent couple of days trading in a range again before it
attempts to move ahead and past its 100-DMA in order to continue with its
reversal attempt.
All and all, mildly negative to flat opening likely
and the Markets may trade in a range. It shall have to maintain levels of
5790-5800 and above in order to just consolidate and avoid any corrective
weakness. Shorts should be refrained from and any temporary consolidation or
mild downside should be utilized to make fresh purchases. Overall, cautious
optimism is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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