Wednesday, July 27, 2016

Daily Market Trend Guide -- Wednesday, July 27, 2016

MARKET TREND FOR WEDNESDAY, JULY 27, 2016
Keeping perfectly in line with the analysis carried out yesterday, the Markets did not continue with its attempted breakout and saw it consolidating once again at higher levels. The Markets saw some pressure returning from higher levels while it kept the resistance levels of 8650-8670 sacrosanct. Today, once again, we will see the Markets opening on a flat note and levels of 8650 will continue to act as immediate resistance. Today we enter the penultimate day of expiry of current derivative series and we will see the trade remaining dominated with rollovers.

For today, the levels of 8650 and 8680 will act as immediate resistance levels for the Markets. The supports come in much lower at 8520 and 8475 levels.

The RSI—Relative Strength Index on the Daily Chart is 65.2969 and it has just moved below its overbought territory. It stays neutral showing no bullish or bearish divergence or any failure swings. The Daily MACD continues to stay bullish as it trades above its signal line.

On the derivative front, the NIFTY July futures have shed over 10.09 lakh shares or 4.71% in Open Interest. The August series saw addition of over 61.66 lakh shares or 90.52% in Open 
Interest as rollover picked up pace. NIFTY saw nearly 41% of rollovers happening yesterday.

Coming to pattern analysis, the Markets did make an attempt to break out above the 8600 levels following several days of consolidation. However, as mentioned yesterday, the Markets had got overbought and had demonstrated some signs of short term fatigue on the Daily Charts. The Markets did make an attempt to continue with its up move, it saw some selling pressure coming in from higher levels and it continued to consolidate after posting modest losses.

Overall, though the Markets continue to remain in an overall uptrend, it is likely that it continues to consolidate for couple of more day’s time. The inherent trend continues to remain intact but the levels of 8650 will be critical to watch out for. Any up moves should be best utilized to protect profits on existing positions as all upsides will continue to remain vulnerable to intermittent bouts of profit taking at higher levels.


Milan Vaishnav, CMT
Technical Analyst

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

+91-98250-16331

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.