MARKET TREND FOR MONDAY, MARCH 27, 2017
Indian Equities remained under consolidation as the
benchmark NIFTY50 ended the day on Friday with modest gains of 21.70 points or
0.24% after coming off from the intraday highs. We expect some consolidation to
continue as the Daily Charts show some tiredness at higher levels. NIFTY is
likely to take some breather at currently levels. It is likely that it trades
in a defined capped range, spends some time at current levels before it resumes
its upward move. With 9000-mark as sacrosanct supports, healthy consolidation
will continue. The banning of the RIL from derivatives trading for a year will
have an immediate short term impact on stock and this may weigh on the NIFTY,
per se.
The levels of 9145 and 9180 will act as resistance while
supports are expected at 9060 and 9015 levels.
The Relative Strength Index on the Daily Chart is 65.0180
and it remains neutral. The Daily MACD stays bearish while trading below its
signal line. Apart from a spinning top which signifies caution and
indecisiveness on part of market participants, no significant formations are
observed on Candles.
The NIFTY March futures shed over 4.37 lakh shares while
April futures added over 4.15 lakh shares in OI interest. No major sentimental
shift is observed from these figures.
Going by pattern analysis, after achieving breakout from the
9000-mark, the NIFTY witnessed a “classical throwback” as the prices returned
very near to the area from where it broke out. This phenomenon continues and
such occurrences often results into the kind of consolidation which we are
currently witnessing. In such formations, no structural damage is expected and
the NIFTY is likely to form a fresh area pattern before moving up again.
Overall, while keeping the original uptrend intact, we
expect the consolidation of continue. We also enter the expiry week of the
current derivative series and this will bring with itself some amount of
volatility as well. We advice remaining light on the positions, preserve cash
while continuing to buy at every volatile dip.
Milan Vaishnav, CMT
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member:
Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
+91-98250-16331
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