MARKET REPORT March
18, 2014
The Markets traded perfectly as analysed in our Friday’s
edition of Daily Market Trend Guide (yesterday being a trading holiday on account
of Holi) as it spent entire session in the corrective mode but saw a sharp
recovery in the last hour and half of the trade to end the day with modest
gains. The Markets opened on a negative note and traded negative for the most
part of the session. After opening negative, the Markets spent the entire
morning and late afternoon trade in a
sideward trajectory while making fresh intraday lows gradually. It went on to
form day’s low of 6432.70 in the late afternoon trade. However, the last hour
and half saw a sharp recovery. The Markets not only reversed its gains, but
traded in the positive territory as well. It went on to give its day’s high of
6518.45 recovering almost 80-odd points from its intraday low. It finally ended
the day at 6504.20, posting a modest rise 11.10 points or 0.17% while forming a
lower top and lower bottom on the Daily High Low Charts.
MARKET TREND FOR TODAY
The Markets have enjoyed an extended weekend with Monday
being a trading holiday. Today, the Markets are expected to open on a positive
note and continue with its up move in the initial trade. The global markets
have been supportive and this would get reflected in today’s trade. Though the
intraday trajectory would be important to decide the trend for today, more
or less, the Markets would continue to
remain in a trading range with up ward bias.
For today, the levels of 6535 and 6560 would act as
immediate resistance levels for the Markets. The supports exist at 6430 and
6400 levels.
The RSI—Relative Strength Index on the Daily Chart is
69.8475 and it is neutral as it shows no
bullish or bearish divergences or failure swings. The Daily MACD continues to
remain bullish as it trades above its signal line.
On the derivative front, the NIFTY has shown a very minor
decline in Open Interest. This shows that the sharp up move that we saw on
Friday has been account of acute short covering and as analysed the FIIs have
continued to buy heavily in Cash segment while selling in futures creating
shorts which are acting as supports at lower levels.
Going by the pattern analysis, the Markets have broken out
on the up side from 6420 levels and has made an immediate top at 6561 levels.
The Markets are expected to consolidate in this broad trading rage with a
certain upward bias. The Markets are anyway seeing a frequent addition of short
positions and this would make the Markets take support at the lower end of the
range.
All and all, the Markets are in typical consolidation mode
and the bias remains certainly on the upside. This gets confirmed as the
Markets sees a sharp rise whenever it approaches the lower end of the trading
range. There has been no technical breach on the Charts and the Markets
continue to trade above its critical supports. It is advised to refrain from
shorts and continue to utilize the downsides in making selective purchases.
Overall, positive outlook is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.