MARKET REPORT
July 02, 2013
The Markets continued with its smart pullback for the third
day in a row as it opened on a modestly negative note but ended the day with
yet another decent gain. The Markets opened on a modestly negative note and
gave its intraday low of 5822.20 in the very early minutes of the trade.
However, after this, the Markets soon transformed itself into rising trajectory
and remained so for the rest of the session.
The Markets went on to rise gradually for the entire session. It went on
to give its day’s high of 5904.35 rising over 75-odd points from the day’s
lows. It finally ended the day at 5898.85, posting a net gain of 56.65 points
or 0.97% while forming a higher top and higher bottom on the Daily High Low
charts.
MARKET TREND FOR TODAY
The Markets have risen over 300-odd points in three sessions
moving past its 200 and 100 DMAs in between. Today, most probably should be a
day of positive consolidation. Expect the Markets to open on a flat to mildly
negative note and look for directions. Today’s session is likely to be range
bound with the Markets trading in a very capped band.
For today, the levels of 5926 which is the 50-DMA of the
Markets and 5960 are expected to act as immediate resistance on the Charts. The
supports come in at 5848 and 5824 levels.
The lead indicators continue to point towards continuing
uptrend in the immediate short term. The RSI—Relative Strength Index on the
Daily Chart is 55.5247 and it has reached its highest value in last 14-days
which is bullish. It does not show any bullish or bearish divergences. We have
reported a possible crossover of the Daily MACD. Today, MACD on the Daily
Charts is bullish as it has reported a positive crossover and it now trades
above its signal line.
On the Derivative front, NIFTY July futures have went on to
add yet another over 9.20 lakh shares or over 6.42% in Open Interest. This is
yet another indication of possible continuation of uptrend as fresh longs have
been seen.
Having said this, all indicators point towards continuation
of up trend. The lead indicators show potential bullish trend in the immediate
short term, the Daily MACD has reported a positive crossover and the futures
show continued addition of the Open Interest. This all indicate that the
uptrend in the immediate short term is likely to continue.
However, since the Markets have risen over 300-odd points in
last three sessions, some consolidation also cannot be ruled out. This would be
positive consolidation and would be healthy for the Markets. Such
consolidations usually see the Markets trade in a range. Today’s session may
also see the Markets trading in a range. However, in event of any temporary
weakness, the defensives like IT and Pharma may outperform. While strictly
avoiding shorts continuation of positive outlook is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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