Daily Market Trend Guide -- Thursday, March 19, 2015

MARKET REPORT                                                                                    March 19, 2015

Markets ended with a modest loss yesterday as caution grew ahead of FOMC meet outcome. The Markets saw a absolutely flat and quiet note and traded in a capped range with minor losses. After range bound movement in the morning, the Markets attempted to recover from its modest morning losses as it traded flat and in positive territory for a very brief period. It traded absolutely flat in the afternoon trade as caution overweighed the overall sentiments. In the second half of the Markets saw some weakness coming in as it gradually lost some more ground. It went on to form the day’s low of 8664. Some minor recovery was seen but the Markets finally settled the day at 8685.90, posting a modest loss of 37.40 points or 0.43% while continuing to form a higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR THURSDAY, MARCH 19, 2015

The Markets are to positively react to the FOMC announcements coming in wherein the rate hike in immediate future, i.e. April seems to be unlikely. Reacting to this, Markets are likely to see a decently positive opening. With such decently positive opening, the support zone of 8620-8660 would continue to remain valid. However, it would be important to see if the Markets maintains these gains and capitalizes on it later.

The levels of 8850 and 8920 would act as immediate resistance for the Markets. The supports would come in at 8620 and 8570 levels.

The RSI—Relative Strength Index on the Daily Chart is 46.3906 and it continues to remain neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD remains bearish trading below its signal line.

On the derivative front, the NIFTY March futures have shed further over 7.43 lakh shares or 3.08% in Open Interest. This signifies some more unwinding of positions. The NIFTY PCR stands at 0.89 as against 0.91 a day earlier.

Coming to pattern analysis, the decently positive opening will keep the support zone of 8620-8660 valid as of now. Also, this will keep the Markets trading comfortably above all of its three moving averages. However, this will also continue to keep the Markets in the overall broad range of consolidation that it has been trading in. In order to continue with its up move, it will have to move past the levels of 8925 with good amount of participation and volumes in order to keep the original trend intact. Currently, the intermediate trend of the Markets remains that of consolidation.

Overall, Markets are all likely to see the positive and nearly gap up opening today. At the same time, it would be necessary for the Markets to maintain those gains and capitalize on it as well. Though this would still keep the Markets in the overall consolidation zone, selective purchases may be made. While keeping a vigilant eye on profits, positive outlook is advised for the day.

Milan Vaishnav,

Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA

www.MyMoneyPlant.co.in

http://milan-vaishnav.blogspot.com

+91-98250-16331

milanvaishnav@mymoneyplant.co.in

milanvaishnav@yahoo.com

Daily Market Trend Guide -- Wednesday, March 18, 2015

MARKET REPORT                                                                                       March 18, 2015

Volatility continued to persist in the Markets as the Markets saw swings on either side before ending the day with decent gains on back of sharp short covering in the last hour of the trade. The Markets saw a modestly positive opening and it saw some more strength in the late morning trade as the Markets formed its intraday high of 8742.55. It flattened its trajectory for a brief period and the afternoon trade saw a steady paring of morning gains. At one point of time the Markets pared all of its gains to trade absolutely while forming the day’s low of 8630.80 coming off nearly 100-odd points from high point of the day. However, the last hour of the trade saw equally sharp short covering from lower levels. The Markets saw a near parabolic rise and it recouped most of its afternoon losses. It finally ended the day at 8723.30, posting a net gain of  90.15 points or 1.04% while forming a higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR WEDNESDAY, MARCH 18, 2015

Expect the Markets to open on a modestly positive note and look for directions. The support zone of 8620-8660 has held out as good support levels for the Markets and this would continue to be important support zone for the Markets in intermediate short term as well. It would be important to see the intraday trajectory that the Markets forms post opening which would dominate the trend for the day.

The levels of 8790 and 8845 would act as resistance for the Markets. The supports come in at 8630 and 8600 levels.

The RSI—Relative Strength Index on the Daily Chart is 48.4533 and it remains neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD continues to remain bearish trading below its signal line.

On the derivative front, the NIFTY March futures have shed over 8.54 lakh shares or 3.42% in Open Interest. Though this very distinctly shows short covering from lower levels, and it can also be interpreted as validating the support zone as well. NIFTY PCR stands at 0.91.

Coming to pattern analysis, the Markets have managed to hang on above the support zone of 8620-8660 and its filter. This support zone would continue to remain an important support zone as any breach below this level and its filter will see the Markets facing some more weakness in the immediate short term. So long as the Markets continue to remain above this zone, it would continue to see consolidation and would keep its overall trend intact.

All and all, though the Markets have managed to remain above its important support levels, it is not completely out of the woods as yet. It needs to move past the levels of 8920 and remain above that to resume its up move. Until that happens it would continue to remain in a very broad trading range and consolidation zone. While continuing to keep overall exposure at modest levels, selective approach is advised for the day.

Milan Vaishnav,

Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA

www.MyMoneyPlant.co.in

http://milan-vaishnav.blogspot.com

+91-98250-16331

milanvaishnav@mymoneyplant.co.in

milanvaishnav@yahoo.com

Daily Market Trend Guide -- Monday, March 16, 2015

Daily Market Trend Guide                                                        Monday, 16 March 2015

MARKET REPORT            March 13  2015

As expected by the most, the Market  in previous trading session on Friday 13^th March opened on a positive and firm note.  The Market  gained 73 points and went on to register intraday high of 8849.75 in the first hour of trading.

This  intraday high, which was achieved early in the day, was the level,  which fell within the expected and foretold  strong resistance range.  And immediately registering this intraday high, the market started encountering  strong resistance and heavy selling.

The bout of profit booking and selling was  much sharper than expected and the market never recovered from  this for the rest of the trading session and finally closed  at 8647 with damage of 128 points on Nifty.

MARKET TREND FOR  FRIDAY, 16 March 2015

In the  Friday March 13 edition of Daily Market Trend Guide, it was mentioned that  Important resistance exists at 8792 ( 20 Day EMA) and  8871  ( Pattern )  and intraday, with supports at the 50 Day Simple and Exponential Averages ( at Close levels ) , which are 8658 and 8677 range.  .

Likewise, the market in spite of all positive clues, failed to move beyond  8849.75 intraday  and encountered heavy selling pressure, but the all important expected  support of 8644 ( Pattern ) was not breached . The intraday low was 8631, which was not much below the expected range of 8658 – 8677.

The resistance was expected as stated, but the selling bout was much sharper then expected . What was expected in a few trading day, was witnessed in a day, and the market  which saw heavy volatility of 218 points Nifty, gave a tall intraday bar on Daily High Low charts of Nifty touch both resistances and supports in a day.

Pattern Analysis indicate that for today and rest of the week, the  range of 8644 ( Pattern ) and 8665 (  50 Day Simple Moving Average) as of today, has become very decisive range.

On Candle charts, the engulfing bearish pattern occurs during a downtrend it may be a last engulfing bottom which indicates a bullish reversal.  The test to see if this is the case is if the next candle closes above the bottom the current (black) candle's real body. The MACD is bearish since it is trading below its signal line.The MACD crossed below its signal line 4 trading days ago. The RSI has just reached its lowest value in the last 14 periods.  This is bearish and its is a Failure Swing.

This technical analysis   indicates that the markets are   still not out of woods. Expect  bouts of selling at every rise. 

Today markets are  expected to open on a flat to weak note. 

Today,  If the market opens above this range and manages to hang on above this range,  this range will act as important support levels for the day. On down side, if the Markets breach these levels,  it should find support at  8560 – 8535 range as indicated by Pattern Analysis.

Until the markets move above these decisive and all important  range, weakness is expected and this is applicable today and for  the rest of the week.   

Milan Vaishnav,

Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA

www.MyMoneyPlant.co.in

http://milan-vaishnav.blogspot.com

+91-98250-16331

milanvaishnav@mymoneyplant.co.in

milanvaishnav@yahoo.com

Daily Market Trend Guide -- Friday, March 13, 2015

                                                                                                                      Friday, 13 March 2015

MARKET REPORT            March 12 2015

The Correction that was witnessed in the markets for three trading sessions  halted  yesterday, as markets rebounded from its expected  support zone of its  50 Day Simple and Exponential  moving averages.

Yesterday, markets opened on a more than expected firm note.  The strength in the markets continued for the entire trading session, till close. The market remained ranged bound near its intraday high through out trading session. The market  broke out of the  intraday trading range   and staged sharp breakout in last hour of trading session.

The 30-share S&P BSE Sensex closed 0.95%, or 271.24 points, higher at 28,930.41, while the National Stock Exchange’s 50-share Nifty was up 0.87%, or 76.05 points, to end at 8,776.

Substantial amount of short covering was seen in the markets yesterday .

MARKET TREND FOR  FRIDAY, 13 March 2015

Today, before technicals of the markets, a few external, non technical events that are likely to impact the markets today deserves a mention.

Today market sentiments will be positively boosted by late evening passage of Insurance Laws ( Amendment ) Bill by Rajya Sabha. Clues from overseas markets will also positively impact mood of the markets today. IIP and CPI data were released post close of the yesterday’s trading session. Industrial production growth slowed for a second straight month to 2.6% in January, compared with 3.2% in the previous month, while retail inflation inched up to a four-month peak of 5.37% in February. This has increased expectations of another round of rate cut by RBI, sooner than  later.

In backdrop of these external factors impacting the markets today, let us  pay attention to what prevails at the end of the day – technical analysis of markets.

It was mentioned here in previous edition that Pattern Analysis clearly indicates that market is  taking intraday support in range of 50 Day SMA and EMA.- Moving Averages. Hence, till  these are breached, it  can be considered support zone  intraday and at close for the market.

As expected, the correction which continued for three days, halted near these support levels. Pattern Analysis of Nifty indicates that the market has given a Higher Top Higher Bottom on its Daily High Low Chart. With this, at least for the time being, the 50 Day Simple and Exponential Averages ( at Close levels ) , which are 8658 and 8677 as of today have become good support for the market.

On Candle Chart, A white body occurred as Nifty closed higher than they opened. This is a positive. RSI- Relative Strength Index, which was a technical cause of  concern till yesterday, as mentioned in yesterday’s edition of Daily Market Trend Guide, as it showed both Failure Swings and negative Divergence, has repaired itself with yesterday’s rise in Nifty. Technical analysis of Nifty’s RSI throws no causes of technical concerns, as The RSI is not currently in a topping (above 70) or bottoming (below 30) range and is showing neither Failure Swings or Divergence. Another important Momentum Indicator - Stochastic Oscillator - is 13.3990.  This is an oversold reading.

These technicals  of Nifty read along with the backdrop of above mentioned non technical factors today, it can be concluded that positive bias will be more or less intact today. Important resistance exists at 8792 ( 20 Day EMA) and  8871  ( Pattern )  and intraday, with supports at above mentioned range.

Milan Vaishnav,

Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA

www.MyMoneyPlant.co.in

http://milan-vaishnav.blogspot.com

+91-98250-16331

milanvaishnav@mymoneyplant.co.in

milanvaishnav@yahoo.com