MARKET OUTLOOK FOR TUESDAY,JUNE 12, 2018

MARKET OUTLOOK FOR TUESDAY,JUNE 12, 2018

In our previous note, we had expected the zones of 10820-10850 to provide stiff resistance to the Markets. Very much on the analyzed lines, the NIFTY opened positive, saw short covering during the day, posted day’s high at 10850.55 and saw itself reacting from those levels and paring much of its intraday gains. The benchmark Index ended the day with gains of 19.30 points or 0.18% coming off nearly 65-points from the high point of the day.

As we step into Tuesday, we expect the zones of 10820-1850 continuing to offer stiff resistance to the Markets. A quiet start is likely but unless the levels of 10850 are breached on the upside, NIFTY will continue to remain vulnerable to corrective actions at higher levels.

Tuesday will see the levels of 10820 and 10850 acting as immediate resistance area for the Markets. Supports come in at 10745 and 10710 zones.

The Relative Strength Index – RSI on the Daily Chart is 59.3566. It has marked a fresh 14-period high which is bullish. It does not show any divergence against the price. The Daily MACD is bullish as it trades above its signal line. On the Candles, a Shooting Star emerged. This formation is significant in the present scenario as it has occurred after an up move and near a pattern resistance area. This can potentially throw the Markets into some consolidation or minor corrective move once again.

Pattern analysis shows that NIFTY resisted precisely at the falling trend line resistance area. This trend line is formed by joining each subsequent falling tops after 10179 mark.

Overall, Tuesday’s trade may not see any runaway up move happening in the Markets. Unless the levels of 10850 is breached on the upside, we will see each up move getting stalled in the 10820-10850 zones. We continue to recommend making fresh purchases at lower levels with and make use of each corrective move, however, it would be critical to remain highly stock and sector specific in the approach. Also, on the other hand, while adopting a cautious view on the Markets profits should be guarded at higher levels.

STOCKS TO WATCH:

Relatively better technical set up is observed in stocks like NCC, ORIENT PAPER, TRIVENI ENGG., JINDAL STAINLESS, DALMIA BHARAT, PI INDUSTRIES, HDIL, ZEE ENTERTAINMENT, TV18 BROADCAST and TECH MAHINDRA.

(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research & Advisory Services, Vadodara. He can be reached at milan.vaishnav@equityresearch.asia)

Milan Vaishnav, CMT, MSTA
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)

Member: 
CMT Association (Formerly known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK 
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