MARKET REPORT August
01, 2014
The Markets ended the July series on a bearish note as it
opened negative but plunged later to end the day with good amount of losses.
The Markets opened in negative territory on a quiet note and spent the entire
first half of the session in sideways manner moving in a very narrow and capped
15-odd points range. In the second half, the weakness crept in to the Markets
and intensified later as the Markets kept gradually making new lows. It went on
to post the day’s low of 7711.15 towards the end of the session. It finally
ended the day at 7721.30 after making a very modest recovery and posting a net
loss of 70.10 points or 0.90% while forming a parallel bar on the Daily High
Low Charts.
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MARKET TREND FOR TODAY
The Markets have traded yesterday
precisely in the manner analysed in our yesterday’s edition. We had mentioned
that the Markets are witnessing Broadening Formation and this can have bearish
implications in the immediate short term. Today as well, expect the Markets to
open on a lower note and look for directions. Intraday trajectory would be
crucial and the Markets may test its 50-DMA levels as well.
For today, the levels of 7790
would act as resistance and the levels of 7685 and 7570 would act as supports.
The RSI—Relative Strength Index on
the Daily Charts is 55.5974 and it is neutral as it shows no bullish or bearish
divergences. The Daily MACD continues to remain bullish as it trades above its
signal line.
On the derivative front, the NIFTY
August futures have added 32.70 lakh shares or 32.88% in open interest.
However, this figure stands little irrelevant yesterday as yesterday was a
expiry day for the July series.
As mentioned yesterday, the
Markets are witnessing a Broadening Formation on the Daily as well as Weekly
Charts as well. This has bearish implications in the short term and there are
chances that we may continue to see some correction continuing while witnessing
intermittent pullbacks.
Overall, we continue to maintain
our advisory on guarding profits at higher levels. Today, we might see lower
opening but correction may remain range bound and see some intermittent
pullbacks as well. Purchases should be made in very selective and limited
manner. While maintaining more of liquidity, cautious outlook is advised for
today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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