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Thursday, January 22, 2015
Daily Market Trend Guide -- Thursday, January 22, 2015
Markets had yet another day of up move and scaled their
fresh lifetime highs once again and ended the day with modest gains. The
Markets saw a flat to mildly positive opening and soon formed its intraday high
of 8741.85 in the morning trade. However, thereafter, the Markets spent most of
the time in a ranged and capped manner. Soon forming this high, the Markets saw
equally sudden paring of gains as it dipped into negative for a brief period
forming the day’s low of 8689.60. Markets recovered again after this and spent
the rest of the entire session trading in a range bound manner with some amount
of volatility ingrained in it. It finally settled the day at 8729.50, posting a
modest gain of 33.90 points or 0.39% while continuing to form a higher top and
higher bottom on the Daily Bar Charts.
MARKET TREND FOR
THURSDAY, JANUARY 22, 2015
Today, expect the Markets to see a modestly positive opening
once again and might test its fresh highs again. The Markets may trade positive
in the opening trade but at the same time some consolidation is likely at
higher levels. The Markets are showing very mild signs of weariness and might
witness some profit taking from higher levels even while keeping the original
The levels of 8750 and 8785 would act as immediate
resistance levels as the Markets continue to trade in uncharted territory. The
supports would come in much lower at 8640 and 8610 levels.
The RSI—Relative Strength Index on the Daily Chart is
70.1118 and it has reached its highest value in last 14-periods which is
bullish. It does not show any bullish or bearish divergence but now trades in “overbought”
zone. The Daily MACD continues to remain bullish while trading above its signal
On the derivative front, the NIFTY January futures have
continued to add modest open interest which shows some fresh amount of buying
continued in the Markets.
Returning to pattern analysis, the Markets have successfully
moved past its previous high and has attempted a breakout. The Markets are most
likely to continue with its up move given the structure of the Charts but at
the same time we cannot rule out some minor profit taking at higher levels.
This may not result in any major decline but we can certainly see some amount
of consolidation at higher levels.
Overall, the trend certainly remains intact. However, in the
same breath, the Markets are showing very mild signs of weariness and this
might result into some consolidation and mild profit taking at higher levels.
Overall, selective purchases may be made but more emphasis should be laid on
protecting profits on existing positions at higher levels. Overall, cautious
optimism is advised for the day.
Technical Analyst, Af.
Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA