MARKET OUTLOOK FOR THURSDAY, JULY 27, 2017
Buoyant behavior of the Indian Equity Markets continued on
Wednesday as well as the benchmark NIFTY50 went on to scale and close at record
5-figure mark of 10,020.65 posting gains of 56.10 points or 0.56%. Markets have
continued it stellar performance and at the same time have got quite overbought
as well. On Thursday, we expect a modestly positive start and expect a minor up
tick as well. We also enter the expiry day of the current derivative series and
expect volatility to persist and also expect the Markets to encounter bouts at
higher levels.
The levels of 10050 and 10090 are likely to act as immediate
resistance levels for the Markets. Supports exist much lower at 9960 and 9875
zones.
The Relative Strength Index – RSI on the Daily Chart is 73.6635.
It has shown a Bearish Divergence as the NIFTY scaled a fresh 14-period high
while the RSI did not. Also, RSI remains in overbought territory. The Daily
MACD stays bullish while trading above its signal line.
There are all chances that the Markets may continue to
out-perform and post some upticks on Thursday as well. However, we cannot ignore
the fact that the lead indicators remain overbought and they show bearish
divergence against the price. We also need to keep in mind that being the expiry
day of the current derivative series; volatility may very much remain ingrained
in the session. We recommend extremely caution for short term participants at
this juncture and advise to approach Markets with high degree of caution.
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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