MARKET TREND FOR WEDNESDAY, MAY 10, 2017
In our previous note, we had categorically mentioned about
the possibility of the Markets remaining in a defined range as the Markets will
were expected to consolidate. In line with this analysis, the Markets headed
nowhere on Wednesday as the benchmark NIFTY 50 oscillated in a 30-odd points
band and ended the day with negligible gains of 2.80 points or 0.03%. While we
expect a flat opening on Wednesday, steadfast consolidation is expected to
continue. While showing no signs of any reversal of trend, the Markets are
fiercely consolidating in a given defined range.
The levels of 9350 and 9375 will continue to act as major
resistance levels for the Markets. The supports come in lower at 9260 and 9225
zones.
The Relative Strength Index – RSI on the Daily Chart is
60.3780 and it remains neutral showing no divergences. The Daily MACD has
reported a negative crossover and it is now bearish as it trades below its
signal line. No significant formations were observed on Candles.
The pattern analysis very clearly shows the zones of
9350-9375 being established as major pattern resistance and immediate top.
Though there are virtually no signs of any reversal of trend, fresh up moves
shall occur only after the NIFTY moves past these defined resistance levels.
All and all, as we have mentioned often in our previous
note, we reiterate once again that given the direction-less nature of the
Markets, it is best advised to continue to adopt stock specific approach. The
NIFTY is likely to continue to consolidate and resist to the 9350-9375 zones,
but there will be select pockets which will continue to out-perform. While
strictly avoiding shorts, stock specific approach while keeping overall
exposures modest is advised for the day.
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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