MARKET REPORT May
06, 2015
Markets traded
much on expected lines yesterday as it consolidated above its 200-DMA to end
the day flat with very minor losses. The Markets saw a negative opening and
post negative opening, it traded with capped losses in the initial trade. It
perked up higher into the positive territory in the late morning trade and
formed its intraday high of 8355.65. The second half of the session saw the
Markets paring all of those gains. It came off from its intraday highs to trade
flat. Further it dipped into the negative territory and went on to form the
intraday low of 8280.60. It was the last hour and half of the trade with again
saw the Markets recovering a bit. It finally ended the day at 8324.80, posting
a minor loss of 7.15 points or 0.09% while forming a marginally higher top and
bottom on the Daily Bar Charts.
Today’s analysis
continues to remain more or less on similar lines. Though the Markets have
attempted to find its bottom, it does not seem completely out of the woods as
yet. Today, we can expect a modestly negative start to the trade and just like
yesterday, the levels of 200-DMA would continue to provide crucial guidance to the
impending trend for today as well as days to come. The Markets will have to
continue to maintain itself above the 200-DMA.
For today, the
levels of 8375 and 8430 will act as immediate resistance on the Charts. The
supports come in at 8275 and 8230 levels.
The RSI—Relative Strength
Index on the Daily Chart is 41.7273 and it remains neutral as it shows no
bullish or bearish divergence or failure swing. The Daily MACD remains bearish
as it trades below its signal line. However, it is moving towards reporting a
positive crossover in coming sessions if the Markets do not see a major
downside.
On the derivative
front, the NIFTY May futures have further shed over 15.46 lakh shares or over
8.44% in Open Interest. This is little precarious figure as the Markets are
seeing some short covering from lower levels but at the same time it is not
getting replaced with fresh buying.
Going by the
pattern analysis , the Markets have attempted to find its bottom and has no
moved past its 200-DMA. As mentioned in our previous edition, this level of
200-DMA is now supposed to provide support to the Markets if it consolidates.
It would be very crucial for the Markets to stay above 200-DMA levels in order
to prevent any weakness from creeping in. It is likely that the Markets
continue to see some amount of consolidation before its attempts to resume its
up move.
All and all, also
as mentioned earlier, the Markets are not completely out of the woods as yet.
The attempt to find a bottom is made but at the same time, the confirmation is
still awaited and the Markets may see range bound consolidation with some
amount of volatility ingrained in it. The levels of 200-DMA would be crucial to
watch out for. It is advised to restrain from creating any aggressive positions and maintain cautious
outlook for the day.
Milan Vaishnav,
Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA
www.MyMoneyPlant.co.in
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA
www.MyMoneyPlant.co.in
+91-98250-16331
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