Saturday, December 7, 2013

Daily Market Trend Guide -- November 22, 2013

Due to technical glitch, we have not been able to publish your copy of Daily Market Trend Guide in regular PDF format. The section "Market Trend for Today" is reproduced below in text format. Inconvenience caused is sincerely regretted.

MARKET TREND FOR TODAY

The Markets saw a sharp bout of correction yesterday as the fears of US tapering of fiscal stimulus returned on back if strong US economic data. The Markets ended that day at at 5999.05, posting net loss of 123.65 points or 2.20%.


Today we can fairly expect this madness in the Markets to end and we hope to see some respite from the weakness that we hapave been seeing since last two sessions. Today, expect the Markets to open on a flat to mildly positive note and look for directions. The chances of stability returning to the Markets are brighter because the Markets still trades above its critical supports and there has been no structural breach on the daily chats.

For today, the levels of 5950 would continue to act as important supports at close levels.

The lead indicators on the Daily Charts show some possibility to resilience. The RSI--Relative Strength Index on the Daily Charts is 42.95 and it does not show any failure swings. The NIFTY has set a new 14-day low but RSI has not and this is billish divergence.

On the derivative front, the NIFTY futures have shed over 18.36 lakh shares or 8.96% in open interest. This clearly shows strong unwinding taking place yesterday.

The overall reading in the Markets is mixed as on one hand it shows strong possibility of resilience as indicated by lead indicators and in the other hand the derivative data show clear offloading in the key stocks.

All and all, there are still fair chances of stability returning in the Markets. However, for the Markets to sustain this, we will need to see clear addition of OI through creation of fresh longs. It is strongly advised to avoid shorts and use such downsides to make selective purchases. Defensives woud continue to outperform, however over exposure shoukd be avoided and liquidity should be preserved to maintain existing positions.


Milan Vaishnav,
Consulting Technical Analyst,
MyMoneyPlant.co.in

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