Tuesday, December 15, 2015

Daily Market Trend Guide -- Tuesday, December 15, 2015

MARKET REPORT                                                                            December 15, 2015
The Markets had a volatile session yesterday but traded precisely on dotted lines as it attempted to take support on the Double Bottom pattern support and ended the day with modest gains. The Markets opened negative and formed its intraday low of 7551.05 in the early minutes of the morning trade. However, it crawled back to trade flat near its previous close quickly and traded with limited gains. The Markets spent the most part of the session in a bit wide 50-odd points range and remained volatile while it oscillated back and forth within this range. Though it formed its day’s high of 7663.95 in afternoon, it pared nearly all of its gains in late afternoon trade to trade flat and even dip briefly into negative. However, one again it crawled back and finally managed to end the day at 7650.05, posting a net gain of 39.60 points or 0.52% while forming a lower top and lower bottom on the Daily Bar Charts.

MARKET TREND FOR TUESDAY, DECEMBER 15, 2015
Markets have so far traded very much on expected lines and have attempted to take support near its important pattern support of 7540. Today as well, we can expect a quiet start to the Markets and this level, i.e. 7540 will continue to act as important support to the Markets. The Markets are likely to see some consolidation and some minor technical pullbacks as well but on the upper side, another level of 7680-7700 levels will continue to pose resistance as these are the pattern supports it breached on its way down.

Today, the levels of 7680 and 7700 will act as immediate resistance to the Markets. The supports come in at 7540 levels.

The RSI—Relative Strength Index on the Daily Chart is 36.5648 and this remains neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD remains bearish as it trades above its signal line.

On the derivative front, the NIFTY December futures have added over 3.87 lakh shares or 1.99% in Open Interest. The NIFTY PCR stands at 0.81 as against 0.76.

Coming to pattern analysis, the Markets have attempted to take support at one of its very important pattern support and 52-week low of 7540. The Markets rebounded from there on expected lines yesterday but have still remained within a limited range and expects to encounter few more resistances on the way up. There are chances that in event of very less participation, the Markets consolidate and oscillate a bit in a give range and then pare some ground again. However, there will be no serious breach on the downside until the Markets are trading above 7540 levels. However, there are no signs of any clear bottom formation and the Markets continue to remain vulnerable to sell-offs at higher levels.

All and all, as mentioned above, the Markets are not yet out of the woods at all and though we have witnessed a technical pullback on expected lines, it continues to remain vulnerable to selloffs at higher levels. We continue to reiterate cautious outlook on the Markets and advice to keep exposures down to very limited levels until sings of clear bottom formation are seen.

Milan Vaishnav,
Consulting Technical Analyst

Af. Member: Market Technicians Association, (MTA), USA
Af. Member: Association of Technical Market Analysts, (ATMA), INDIA

+91-98250-16331



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