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Thursday, January 22, 2015
Daily Market Trend Guide -- Friday, January 23, 2015
The Markets continued its up move and surged ahead while
marking fresh lifetime highs but also clearly shows signed of some weariness
while it ended the day with modest gains yet again. The Markets saw a modestly
positive start and post modestly positive opening it added to its gains a bit
in the morning trade. However, it pared most of its gains while remaining in
extremely ranged bound manner by late afternoon trade as it also dipped
slightly in the negative for a very brief period. The last hour and half of the
trade saw the recovery and the Markets went near to its morning highs. It also
went on to form the day’s high of 8741.85 towards the end. It finally settled
the day at 8761.40, posting a net gain of 31.90 points or 0.37% while
continuing to form a higher top and higher bottom on the Daily Bar Charts.
MARKET TREND FOR
FRIDAY, JANUARY 24, 2015
The Markets are now trading in uncharted territory and
technically speaking, they are set to continue with its up move. Given this
thing, we can expect a flat to modestly positive start to the session but at
the same time, the Markets are also continuing to show some signs of tiredness
and this may result into consolidation at higher levels or some mild profit
taking while keeping the original trend intact.
The levels of 8775 and 8830 are likely to act as immediate
resistance while support come in much lower at 8690 and 8610 levels.
The RSI—Relative Strength Index on the Daily Chart is
71.1620 and it has reached its highest value in last 14-days which is bullish.
It does not show any bullish or bearish divergence but it now trades in “overbought”
zone which is a thing of mild concern. The Daily MACD continues to remain
bullish while trading above its signal line.
On the derivative front, the NIFTY January futures have went
on add yet another over 4.54 lakh shares or 2.05% in Open Interest. This is a
positive indicator showing continuing addition of fresh positions in the Markets
on the long side.
Returning to pattern analysis, the Markets are continuing to
surge ahead after it broke out on the upside moving past its previous top.
However, now that Markets have added some gains moving past this level, it is
showing some signs of tiredness at higher levels. The original up trend remains
absolutely intact and this is supported by F&O data as well. However, there
are fair chances that the Markets may take some breather and this may result
into consolidation at higher levels or very mild profit taking.
Overall, taking this picture in view, one can certainly
continue to make fresh purchases given the original trend remaining intact.
However, as we have mentioned in our previous edition, the same amount of
vigilant attention is required to protect profits at higher levels. Continuance
of cautious optimism is advised for the day.
Technical Analyst, Af.
Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA