MARKET REPORT May
06, 2014
The Markets stopped its 5-day losing streak yesterday as it
ended the day yesterday on a minor green tick, though after lot of volatile
movement during the day. The Markets opened negative and formed its intraday
low of 6680.45 in the very early seconds of the trade. It crawled into the
green immediately in the morning trade. The Markets remained in upward rising
trajectory and kept forming gradual new highs. In the late afternoon trade, the
Markets went on to form the day’s high of 6741.05. However, it was only now
that the Markets changed its trajectory. It formed a downward falling channel
and kept paring its gains gradually. At one point it pared all of its gains and
traded flat. The Markets finally ended the day at 6699.35, posting a nominal
gain of 4.55 points or 0.07% while forming a higher top but lower bottom on the
Daily High Low Charts.
MARKET TREND FOR TODAY
Today’s analysis would remain more or less on similar lines
as the Markets are expected to open with a mild up tick but there are chances
that the Markets continues to remain in the corrective mode and it pares its
opening gains as we go ahead in the session. The intraday trajectory would be
important and despite the possibility of the technical pullback that the
Markets may continue to witness the overall corrective state of the Markets may
continue to persist.
The levels of 6725 and 6750 would act as immediate resistance
for the Markets. The supports exist at 6655 and 6610 levels.
The RSI—Relative Strength Index on the Daily Chart is
52.0858 and it is neutral as it shows no bullish or bearish divergence or any
failure swings. The Daily MACD remains bearish as it trades below its signal
line.
On the derivative front, the NIFTY May futures have added
over 2.89 lakh shares or 2.25% in Open Interest. This signifies hat there has
been some fresh shorts that have been created, mostly in the second half of the
session. The NIFTY PCR stands at 0.92 as against 0.91.
The pattern analysis continue to paint the same picture. The
Markets are likely to continue to remain in the corrective mode. However, given
some fresh shorts in the system, it might witness some intermittent technical
pullbacks in the immediate short term but overall structure still continue to
point towards the correction in the Markets continuing for some more time.
All and all, despite mildly positive opening that is likely
today, there are chances that the corrective activities in the Markets
continue. Given the fresh shorts some intermittent pullbacks may be seen with
some amount of volatility remaining ingrained in the Markets. Given this
reading, any up tick should be utilized to protect profits and downsides should
be utilised to make fresh purchases, but on very selective note. While
continuing to remain moderate on the overall exposure, caution is advised for
today.
Milan Vaishnav,
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
http://milan-vaishnav.blogspot.com
+91-98250-16331
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
http://milan-vaishnav.blogspot.com
+91-98250-16331
