MARKET REPORT June
02, 2015
Markets had a volatile but range bound session yesterday as
it end the day on a absolutely flat note after oscillating in either direction.
The Markets saw a quiet opening as expected and it formed its intraday low of
8405.40 in the early morning trade while trading briefly in the negative.
Markets saw some strength as it perked up in the first half of the session and
went on to form the day’s high of 8467.15 in the late morning trade. Markets
struggled to go beyond this and traded the afternoon session in a ranged
manner. It was in the second half that the Markets chose to consolidate and get
cautioned ahead of RBI Credit policy. It came off from its highs and pared
nearly all of its gains and also dipped into the negative territory. However,
some recovery was seen and the Markets ended the day nearly unchanged at
8433.40, posting a nominal gain of 0.25 points or 0.001% while forming a higher
top and higher bottom on the Daily Bar Charts.
MARKET TREND FOR TUESDAY, JUNE 02, 2015
The Markets are expected today to open on a flat to mildly
positive note and look at cues from the RBI Credit policy coming up later
today. The Markets have displayed both –
strength and caution – ahead of RBI Credit Policy. After Friday’s up move, it
showed strength by not correcting and at the same time, preferred to remain
cautious ahead expectation of a rate cut. We will witness ranged trade in the
initial session and after that, will see the Markets reacting to the RBI.
Volatility will remain dominant today.
The levels of 8475 and 8550 will act as immediate resistance
to the Markets. The supports will come in at 8405 and 8350 levels.
The RSI—Relative Strength Index on the Daily Chart is
54.0343 and it remains neutral with no bullish or bearish divergence or failure
swings. The Daily MACD continues to remain bullish as it trades above its
signal line.
On the derivative front, the NIFTY June futures have further
added over 2.46 lakh or 1.56% in the Open Interest. This shows some positive
built up for the Markets. In event of a slightest positive trigger, the Markets
may attempt its move towards its 100-DMA.
Coming to pattern analysis, the Markets have attempted to
confirm a reversal after forming a higher bottom following the low it gave on
May 7th.Having said this, it has managed to move past its 200-DMA
while doing so and is now resisting at its 50-and 100-DMA. In order to confirm
this reversal, the Markets will have to move past these levels. It would
confirm the reversal – which is a potential reversal as of now – if it moves
past these levels. Until this happens, it would continue to trade volatile in a
broad range with the levels of 200-DMA acting as support.
All and all, the Markets will show obvious trend of
remaining range bound in the initial trade and then reacting to RBI Credit
Policy. So far as the Markets go, the 25 bps is what is discounted by the
Markets. No rate cut will be little negative for the Markets and anything more
than 25 bps – which is again not likely at all – will be a big positive
trigger. It is advised to refrain from creating over exposure in the Markets
and continue to adopt a cautious outlook until the Markets take a definite
directional bias.
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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