MARKET TREND FOR TODAY
May 30, 2013
The Markets spent a typically rollovers dominated session as
it remained in the negative territory for the entire session and after briefly
attempting recovery towards the end, closed with nominal losses. The Markets
opened on a mildly negative note and after trading briefly in a range, slipped
further to give the day’s low of 6069.80 in the afternoon trade. The Markets
remained in falling trajectory until afternoon, but the second half of the
trade saw the Markets attempting a recovery. The Markets saw short covering
causing a spurt in the last hour of the trade where the Markets recouped all of
its losses to trade flat. However, in the end the Markets ended the day at
6104.30, posting a nominal loss of 6.95 points or 0.11% while forming a similar
top and higher bottom on the Daily High Low Charts.
Today is an expiry day of the current derivative series and
therefore, expect the session to remain heavily dominated again with rollover
centric activities. The analysis for today remain on similar lines as well as
the Markets continue to consolidate in a capped range. Expect the markets to
open on a flat note and will look for direction and the behaviour of the
Markets vis-à-vis its pattern resistance levels of 6100 would be crucially
important. Any breach below this level will bring in weakness in the Markets.
The levels of 6130 and 6145 shall act as resistance today
and the supports come in much lower at 6035 and 5980 levels.
The lead indicators continue to point towards mild downward
bias. The RSI—Relative Strength Index on the Daily Chart is 57.8350 and it is
neutral as it shows no bullish or bearish divergence or any kind of failure
swings. The Daily MACD continues to remain bearish as it trades below its
signal line.
On the Derivative front, the NIFTY has reported no major
addition in total open interest however heavy rollovers continued in NIFTY as
well as in Stock Futures. Key stocks reported minor shedding of total open
interest.
If we take into account the F&O data and also rely on
the pattern analysis, the Markets are likely to continue to consolidate and
there are some moderate chances of slipping it below 6100 levels and this can
induce some weakness. The Markets will have to maintain levels comfortably
above 6100 in order to avoid any weakness creeping in but the chances of some
more correction, if not today, then in the next week just cannot be ruled out
as there are no explicit triggers on the upside.
All in all, today being the expiry day, the session will
definitely remain dominated with rollover centric activities. This is likely to
keep the Markets highly volatile and swings on either side cannot be ruled out.
With the consolidation continuing and with Markets not taking any clear
directional trend, it is continued to be advised to remain light on positions
while protecting profits wherever available. Cautious approach is continued to
be advised as the bias remains mildly on the downside with no explicit triggers
for an up move expect the rollovers induced volatility.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
