MARKET REPORT August
14, 2014
The Markets had a volatile session wherein it swung in either
direction during the trading session but finally managed to end the day with
nominal gains. The Markets opened on a quiet note and soon perked up in the
morning trade to form the day’s high of 7757.10. However, in the late morning
trade, the Markets pared these morning gains to trade flat. After trading with
very limited gains, the Markets gave up further in the afternoon trade as it
slipped into the red and further went on to form the day’s low of 7695.70. Again, after trading with limited and capped
losses, the Markets saw some recovery from lower levels. It recovered all of
its losses and went again in the positive territory. It finally managed to end
the day at 7739.55, posting a nominal gain of 12.50 points or 0.16% while
continuing to form higher top and higher bottom on the Daily High Low Charts.
MARKT TREND FOR TODAY
Today, we are once again set to see a quiet opening. The
analysis for today remains more or less again on similar lines. The Markets
continue to consolidate at higher levels on declining volumes and it would be
critical to see if they are able to advance their pullback. The intraday
trajectory and the volumes would continue to play a critical role in determining
trend in coming days. We have short trading week as tomorrow would be a trading
holiday on account of Independence Day.
The levels of 7770 and 7815 would act as resistance were as supports
exist at 7670 and 7630 levels on the lower side.
The RSI on the Daily Chart stands at 55.3610 and it remains
neutral with no bullish or bearish divergences or any failure swings. The Daily
MACD is bearish as it continues to trade below its signal line.
On the derivative front, NIFTY August futures have added
over 12.75 lakh shares or 9.92% in open interest. This is relatively a big
addition in open interest given the short trading range that we have had
yesterday.
The pattern analysis continues to show the markets
continuing with its pullback within the broadening formation. Given the OI
addition during the pullback, the Markets may continue to display some more
strength however volumes continue to remain the grey area. Given this character
of the Markets, the Markets may see some
more advance but at the same time profit taking from higher levels just cannot
be ruled out any time.
Overall, it is required to approach the markets with
caution. The relatively lower volumes make any good pullbacks susceptible to
profit taking from higher levels and this is what we require to guard ourselves
against. Given this, it is advised to continue to approach the markets with
cautious outlook while remaining heavily stock specific so far as purchases are
concerned.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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