Gemstone Equity Research & Advisory Services

Thursday, January 2, 2014

Daily Market Trend Guide -- Thursday, January 02, 2014

MARKET REPORT January 02, 2014

The Markets witnessed yesterday a very lack lustre and listless session yesterday and it spent the entire session in a very narrow range to end the day on a flat note. The Markets opened on a positive note and soon formed its intraday high of 6327.20 in the morning trade. However, low volumes and lack of participation continued in the Markets. The Markets slowly pared its gains to trade flat by afternoon. It briefly dipped into negative in the late morning trade while it gave its intraday low of 6298.25. It came back into the green by the end of the session but ended the day at 6301.65, posting a very negligible loss of 2.35 points or 0.04% while forming a slightly higher top and higher bottom on the Daily High Low Charts.

MARKET TREND FOR TODAY

Today, we would expect the Markets to behave in a similar manner like that of previous few sessions. Expect the Markets to open on a flat and quiet note and also expect the Markets to see low volumes and lack of participation. This is likely to keep the analysis again similar to that of yesterday and the levels of 6345 would continue to act as immediate top.

For today, the levels of 6345 and 6370 would act as immediate resistance and the levels of 6240 and 6192 are immediate supports on the Charts.

The lead indicators continue to remain intact. The RSI—Relative Strength Index on the Daily Chart is 57.3794 and it continues to remain neutral as it shows no bullish or bearish divergences or any failure swings. The Daily MACD is bullish as it continues to trade above its signal line.

On the derivative front, the NIFTY January futures have added a nominal 67,950 shares or 0.34% in Open Interest. We can say that the OI remains more or less unchanged and no decline is registered and therefore no shorts or any offloading of positions is seen in the Markets.

The overall tone of the analysis, as we have been off-repeating in some previous editions remains similar for today as well. The Markets continues to remain structurally intact and trades above all its three DMAs. However, the Markets are seeing a very narrow and capped movement over past few sessions due to holiday season and therefore it is witnessing such sessions due to lack of volumes and participation. Also, the levels of 6345 would continue to act as a immediate top for the Markets and fresh sustainable up move shall occur only after the Markets move past this level.

All and all, the trend remains intact and the Markets would continue to see a ranged movement while trading with a upward bias. There are no triggers for creating any shorts and therefore it should be best avoided. There would be stock specific action seen and selective out performance would occur. Any flip side should be utilized to make fresh purchases. Overall, continuation of positive caution is advised in the Markets for today.

Milan Vaishnav,

Consulting Technical Analyst,

www.MyMoneyPlant.co.in

http://milan-vaishnav.blogspot.com

+91-98250-16331

milanvaishnav@mymoneyplant.co.in

milanvaishnav@yahoo.com

Wednesday, January 1, 2014

Daily Market Trend Guide -- Wednesday, January 01, 2014

MARKET REPORT January 01, 2014

The Markets had it session yesterday in a quiet year-end mood as it remained in a very capped range on expected lines and ended the day with minor gains. The Markets opened on a positive note but soon drifted to the lows of the day as it dipped into the negative for a very brief period while recording its intraday low of 6287.30. However, it recovered those gains again in a very short time and traded back into the green. It gradually inched up to give its intraday high in the late morning trade at 6317.30. However, after this, the Markets spent its session in a absolutely quiet and range bound manner. It finally ended the day at 6304, posting a minor gain of 12.90 points or 0.21% while forming a lower top but higher bottom on the Daily High Low Charts.

MARKET TREND FOR TODAY

Today, expect the Markets to usher in a new year on a quiet and positive note and look for directions. The analysis would remain more or less similar again as we would continue to see lower volumes and also some stock specific activities. The session is largely expected to remain capped and the levels of 6344 would continue to act as immediate resistance for today.

Today, the levels of 6344 and 6370 would act as resistance on the charts whereas the supports are expected lower at 6275 and 6230 levels.

The lead indicators continue to remain in place. The RSI—Relative Strength Index on the Daily Chart is 57.6309 and it continues to remain neutral showing no bullish or bearish divergences or any failure swings. The Daily MACD remains bullish as it continues to trade above its signal line.

On the derivative front, NIFTY January futures have continued to act over 4.94 lakh shares or 2.57% in Open Interest. This is a positive reading as this shows that fresh longs were added yesterday even in a capped and range bound markets and offloading was seen.

Overall, the reading here again remains the same as the Markets continues to trade above all of its DMAs and sees no structural weakness on the Charts so long as it continues to trade above its 50-DMA. However the levels of 6344 would continue to act as immediate resistance and the Markets will have to move past this levels for a sustainable up move.

All and all, the reading signifies that for a momentum to catch up and sustain, the levels of 6344 are required to be breached on the upside. In case of any weakness, the markets will have to trade above the levels of 50-DMA. In the present case, until the Markets moves past the levels of 6344, it is likely to continue to see range bound movements. However ,it is advised to strictly refrain from shorts and use such consolidation for making stock specific purchases. Overall, positive outlook is continued to be advised for today.