MARKET TREND FOR MONDAY, APRIL 25,
2016
Quite on expected lines, the Markets have
halted its up move in last couple of sessions as it has consolidated in a
ranged manner. Having said this, it is once again expected to open on a modestly
negative note and while it trades above its 200-DMA which is7863, it will keep
the analysis more or less on similar lines like previous week. Also, we enter
the expiry week of the current derivative series and this will keep the
sessions dominated with rollover centric activities. While the Markets remain
above 200-DMA, we will see it continuing to consolidate in a capped range.
For today, the levels of 7925 and 7960 will
act as immediate resistance levels for the Markets. The supports come in at
7863 and 7820 levels.
The RSI—Relative Strength Index on the
Daily Chart is 66.3221 and it remains neutral while it shows no bullish or
bearish divergence or any failure swings. The Daily MACD stays bullish as it trades
above its signal line. On the Weekly Charts, the Weekly RSI is 54.8627 and it
has reached its highest value in last 14-periods which is bullish. It does not
show any bullish or bearish divergence. The Weekly MACD stays bullish as it
trades above its signal line. On Candles, a Doji Star has occurred. It
often signals reversal if the next candle confirms it.
On the derivative front, the NIFTY April
futures have shed over 2.85 lakh shares or 1.79% in Open Interest. May NIFTY
futures have added over 7.40 lakh shares
or 22.27% in Open Interest.
While having a look at pattern analysis,
while a hanging man was observed couple of sessions back on the Daily
Charts, the up move of the Markets have halted on expected lines. However, so
far, the Markets have been able to maintain itself above 200-DMA and this has
resulted in a range bound consolidation in the Markets. So long as Markets are
able to maintain themselves above 200-DMA, this consolidation will continue.
However, any breach below the 200-DMA mark will induce further weakness in the Markets.
Even on the Weekly Charts, there has
been no clear breakout and the Markets are showing potential signs of forming a
immediate top.
Overall, while having a detailed look at the
Daily and Weekly Charts, the Markets are not likely to give a runaway rise
until it moves past 7950 levels. Until that happens, we will see it
consolidating in a ranged manner. The level of 200-DMA would be important to
watch out for and any breach below that will induce further weakness in the Markets.
We continue to reiterate our cautious stand on the Markets while using any
immediate up moves to protect / book profits at higher levels.
Milan Vaishnav,
Consulting Technical Analyst
Member: Market
Technicians Association, (MTA), USA
Member:
Association of Technical Market Analysts, (ATMA), INDIA
+91-98250-16331
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