Friday, February 8, 2013
MARKET TREND FOR TODAY February 08, 2013
Disappointing session yet again for the Markets yesterday as it continued to moderately correct and consolidate within the broad trading range, though on expected lines to end the day with moderate losses. The markets opened on a modestly negative note but the morning trade saw some positive t rend as the Markets moved into the green. In the late morning trade, it perked up further to give the day’s high of 5978.50. However, after that, the Markets again transformed themselves into falling trajectory and gradually pared all of its gains to dip into the negative. It made a feeble attempt to recover but again pared that attempt too as it gave day’s low of 5927.60. It finally ended the day at 5938.80, posting a moderate loss of 20.40 points or 0.34% while forming a lower top and lower bottom on the Daily High Low Charts.
Today would be an important session for the Markets. The Markets have been precariously hanging on the pattern supports of 5950-5940 levels which is the lower end of the broad trading range. The Markets 50-DMA also stands at 5957 and the Markets have ended a notch below it. Today, a flat opening is expected in the Markets but it would be very critically important to see if the Markets maintain the levels above 5940 to avoid any further weakness.
For today, the levels 5940-5925 shall act as important supports. If this supports are breached, then another support would come in at 5880 levels.
So far as lead indicators goes, the RSI—Relative Strength Index on the Daily Chart is 41.8812 and it has reached its lowest value in last 14-days which is bearish. Though it does not show any negative divergence. The Daily MACD continues to trade below its signal line.
On the derivative front, NIFTY has shed 75,650 shares or nominal 0.59% in Open Interest which shows mild offloading of long positions. The NIFTY PCR stands at 0.97 as against 0.95.
Having said this, there is something important to note here. The Markets have been mildly correcting over last couple of days but it has not been breaking down as such. The main reason for this is the one of the major external event, i.e. Union Budget which comes up later this month. Normally markets rally before the budget but this time, they might not rally, but they are not breaking down either.
This is one of the major reason that we are seeing some shorts being created but no major selling happening and this is keeping the Markets directionless. Normally there is a possibility that we may see a rally prior to the budget, which takes it to around its resistance levels again and then the Markets takes a serious directional call post the Budget.
All and all, there are bright chances that we may continue to see the Markets consolidating again. Even if it momentarily breaches the supports, the weakness too should not remain but longer and we might see improvement from lower levels. Even at this stage, shorts should b e strictly avoided. Cautious outlook with very selective approach is advised for today.
Consulting Technical Analyst,
Thursday, February 7, 2013
MARKET TREND FOR TODAY February 07, 2013
Yesterday’s session in the Markets saw it consolidating fiercely in the broad trading range it has been trading in as it opened positive and strong, but pared all of its gains to end the day absolutely flat. The Markets opened on a positive note and made some further gains in the morning trade as it gave its intraday high of 5990.90. In the late morning trade, in the second half of the session, the Markets made its top and reversed its intraday trend. It gradually pared all of its in the afternoon trade to trade flat. It made some gains again but only to pare them later towards the end of the session. The Markets finally ended the day at 5959.20 posting a negligible gain of 2.30 points or 0.04% while forming a minor higher top and higher bottom on the Daily High Low charts.
Today, the Markets are likely to open on a flat note and look for directions. The analysis for today remains more or less similar to that of yesterday. The markets continue to remain in a broad trading range as yet. It would be critically important for the Markets to trade above the levels 5940-5930 and maintain levels above these so as to avoid any kind of weakness creeping into the Markets.
For today, the levels of 5940-5925 shall act as important support for the Markets.
So far as lead indicators goes, the RSI—Relative Strength Index on the Daily Chart is 44.5712 and it is neutral as it shows no failure swings or bullish or bearish divergence. The Daily MACD is still bearish as it still continues to trade below its signal line.
On the derivative front, NIFTY February futures have shed nominal 1.39 lakh share or 1.07% in Open Interest.
Going by the above figures, there is nothing to on the Charts to trigger a strong directional rally / breakdown on either side. The Markets continues to remain in broad trading range with the levels of 5940-5925 levels acting as major supports. Markets shall see further weakness creeping in only if these levels are breach on the downside. Until then we will continue to see the Markets continue to consolidate in the broad trading range.
All and all, we may see the Markets continue to consolidate and as mentioned earlier, it would be critical to see that the Markets maintains the levels above 5940-5925 in order to avoid any further weakness creeping in. At the same time, it is likely to continue to consolidate and remain little volatile. Given this situation, it is advised to remain light on the positions and remain very selective in making new purchases while vigilantly protecting profits on higher levels. Cautious outlook is advised for today.
Consulting Technical Analyst,
Wednesday, February 6, 2013
MARKET TREND FOR TODAY February 06, 2013
Yesterday was a relatively resilient session as the Markets did not show more weakness than the opening weakness which was relatively much less than its Asian peers and did not break down and traded the day in a capped range above its critical supports, much on the expected lines. The Markets opened negative back of weak global cues and continued to trade in 25-odd points capped range. Though the global weakness was more, the markets held out its important support levels as it recovered a bit after giving the day’s low of 5946.90 against the expected support levels of 5940. The levels of 50-DMA, which is 5947.24 today has held out as support. The Markets ended the day at 5956.90, posting a net loss of 30.35 points or 0.51% while forming a lower top and lower bottom on the Daily High Low charts.
For today, we are likely to see some respite from the weakness that we have been seeing. Expect the Markets to open on a flat to moderately positive note and look for directions. Today would be crucial session for the Markets as it is expected to trade above 5940-5930 levels to avoid any further weakness creeping in. Therefore, the intraday trajectory would be important to decide the trend for today, as well as for coming days.
Today, the levels of 5940-5920 shall act as important and immediate supports.
The RSI—Relative Strength Index on the Daily Chart is 44.1959 and it has reached its lowest value in last 14-days which is bearish. However, it does not show any bearish or bullish divergence. The Daily MACD is bearish as it continues to trade below its signal line.
On the derivative front, NIFTY Futures have shed 1.36 lakh shares or little over 1% in open interest. The NIFTY PCR stands at 0.94 as against 0.90 which is not so bad.
In last couple of days, we have seen quite large amount of short positions being built by the FIIs. During this very same period, the DIIs have remained net sellers in the Markets. Under similar circumstances where FIIs pile up shorts, DIIs usually remain net buyers but the trend has been opposite this time and the combination of these two factors have kept the Markets under pressure since last couple of sessions.
Having said this, big amount of shorts still continue to exist in the Markets. There has been no break down on the Charts and the Markets so far, continue to trade in a broad trading range. As mentioned above, the Markets will have to trade above the levels of 5940-5930 in order to avoid any further weakness. It is advised to remain very light in positions while making selective purchases. Shorts should be avoided as given the amount of short positions, short trap may occur. A very selective and cautious approach with positive optimism is advised for today.
Consulting Technical Analyst,
Tuesday, February 5, 2013
MARKET TREND FOR TODAY February 05, 2013
Yesterday remained a thoroughly disappointing session for the Markets as it opened and a buoyant note, traded buoyant in the initial trade then pared all of its gains to end the day with modest losses. The Markets opened positive and strong and it made its day’s high of 6038.50 in the morning session of the trade. The Markets traded sideways in the first hour and half of trade in a range bound trade but the second half of the trade saw the Markets transforming themselves once again into falling trajectory. The Markets came off its highs, pared its gains to dip into the negative and gave day’s low of 5981.25. It finally ended the day at 5987.25 posting a modest loss of 11.65 points or 0.19% forming a lower top and lower bottom on the Daily High Low Charts. The cut on the close charts has not been deep but Markets came off nearly 60-odd points from day’s high.
Today, we are likely to see a weaker opening in the Markets on back of weak global markets. The Markets are expected to open on a weak and negative note and look for directions. However, the cut is not likely to be as big as other Asian peers as we have already come off much from yesterday’s intraday high post weakness in the European Markets.
For today, the levels of 5940 shall act as a important support levels to watch for.
The RSI—Relative Strength Index on the Daily Chart is 48.1936 and it has reached its lowest value in last 14-days which is bearish. However, it does not show any bullish or bearish divergence. The Daily MACD continues to remain bearish as it trades below its signal line.
Having said this, the derivative statistics paid slightly positive picture. The NIFTY February futures have added over 5.96 lakh shares or 4.74% in Open Interest. This trend has been witnessed also across all key stocks. This very clearly signifies that there has been huge shorts created in the system.
Having said this, as mentioned earlier, we have came off over 60-odd points from yesterday’s intraday high. With today’s weaker opening likely, the cut is not expected to be as big as other Asian Markets. Further to this, the levels of 5940 are likely to act as major support levels. At this point, the supports also exists in form of 50-DMA at close 5940.63.
All and all, even with the Markets testing these levels, there will be no breakdown on the Daily Charts. Further, with heavy shorts existing at current levels, if the Markets tests the levels of 5940, these would come in as another supports and we may not see the Markets giving a negative breakdown on Charts. Overall, while aggressive shorts should be avoided, any downside should be utilized to make very selective purchases. There are chances that we may see some improvement coming in after initial weakness. Cautious outlook with tinge of optimism is advised for today.
Consulting Technical Analyst,