MARKET TREND FOR THURSDAY, APRIL 28,
2016
The Markets are once again likely to see a
modestly start to the day. Today is the expiry day of the current derivative
series and we will see the Markets remaining dominated to the rollover
activities. The intraday trajectory that the Markets form would be critical to
watch out for. The Markets are yet to give a clear breakout and though it has
closed at the 2016 closing highs, clean break out is still awaited and in case
of any up move, the Markets may test 8030-8040 levels wherein it will meet a
pattern resistance.
For today, the levels of 7990 and 8040 will
act as immediate resistance levels. The supports come in at 7940 and 7860
levels.
The RSI—Relative Strength Index on the
Daily Chart is 68.2016 and it has reached its highest value in last 14-days
which is bullish. It does not show any bullish or bearish divergence. The Daily
MACD is bullish as it still rules above its signal line.
On
the derivative front, the NIFTY April futures shed over 20.75 lakh
shares or 17.61% in Open Interest whereas the May Futures added over 40.42 lakh
shares or 34.22% in Open Interest.
Coming to pattern analysis, the Markets
have not yet given a clear breakout. As mentioned in our yesterday’s edition,
the Market took support at its 200-DMA which is 7856 today and have risen from
there once again. However, it has not comprehensively breached its prior high
of 7978 though it has ended a notch above it yesterday. The Markets are likely
to continue to inch upwards and if this happens it may test 8030-8040 levels
wherein it will once again meet another pattern resistance. If this does not
happen, we will see the Markets consolidating once again with the levels of
200-DMA acting as support once again and we will see the Markets oscillating in
140-odd points range once again. The Markets have shown all the signs of
fatigue in recent sessions and it would be important to see how it takes the
expiry session.
Overall, it is important to note that the
Markets are yet to have a clean break out and also it is showing some signs of
fatigue. It certainly remains vulnerable to sharp sell-offs from higher levels
and some intermittent profit taking bouts cannot be ruled out. Given the expiry
day, volatility too might remain ingrained in the Markets. It is advised to
refrain from taking any fresh positions until the directional bias gets clear
and maintain cautious outlook for the day.
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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