Daily Market Trend Guide -- Tuesday, November 24, 2015

MARKET REPORT                                                                                   November 24, 2015

Markets continued to consolidate on expected lines while it ended the day on flat note with nominal losses. The Markets saw a modestly positive opening as it has been doing since previous week, spent the morning trade in a sideways trajectory trading in a capped range. It formed its intraday high of 7877.50 in the late morning trade. However, as apprehended, the Markets did not sustain its modest gains that it had in the morning. The afternoon trade saw the Markets paring all of its gains and trade flat. It slid further into the negative territory to form the day’s low of 7825.50. This downside too remained capped and limited as some recovery was seen in the last hour of the trade. The Markets finally ended the day at 7849.25, posting a nominal loss of 7.30 points or 0.09% while forming a lower top but similar bottom on the Daily Bar Charts.

MARKET TREND FOR TUESDAY, NOVEMBER 24, 2015

Markets are expected to open on a quiet to modestly negative note and would trade in a capped range in the initial trade. Today we enter into penultimate day of the expiry of the current series because tomorrow is a trading holiday on account of Gurunanak Jayanti. The F&O data clearly suggest that the Markets are more or less expected to trade in a range and look for directions and no sharp movement either side is expected. However, the consolidating Markets keeps the analysis more or less once again on similar lines.

Today, the levels of 7900 and 7935 will act as immediate resistance levels for the Markets. The supports come in at 7820 and 7760 levels.

The RSI—Relative Strength Index on the Daily Chart is 42.3418 and it remains neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD continues to remain bearish as it trades below its signal line.

On the derivative front, rollovers continued as the NIFTY November futures shed over 20.15 lakhs or 12.76% in Open Interest whereas the December futures added over 45.63 lakh shares or 76.22% in Open Interest resulting into net addition in the Open Interest.

Coming to pattern analysis, the Markets have remained in a narrow 125-odd points range since last couple of sessions and have headed nowhere. The markets consolidated in this narrow range. As mentioned often in our previous editions, the Markets have attempted to form a bottom but have not yet confirmed it. It will have to maintain levels above 7750 and any breach below this will have the Markets test its important pattern support of 7680 levels. However, any major downside is much limited by possibility.

Overall, though the Markets do not seem to show any possibility of major downsides, the upsides too would remain limited and the Markets continue to remain vulnerable to sell-offs from higher levels resulting into some volatility being ingrained in the Markets. The volumes too are likely to remain lower. Therefore, while keeping the overall exposure limited and very stock specific, continuation of cautious outlook is advised for today.

Milan Vaishnav,
Consulting Technical Analyst

Af. Member: Market Technicians Association, (MTA), USA
Af. Member: Association of Technical Market Analysts, (ATMA), INDIA
www.EquityResearch.asia
http://milan-vaishnav.blogspot.com

+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com

Daily Market Trend Guide -- Monday, November 23, 2015

MARKET REPORT                                                                      November 23, 2015

Markets continued to see some short covering from lower levels and also profit booking at higher levels as it ended the day with minor gains after coming off from the high point of the day. The Markets saw a lower opening and while trading in a very capped and narrow range; it formed its intraday low of 7817.80 in the morning trade. It was in the late morning trade, that the Markets saw a sharp rise. It witness a near parabolic up move that not only brought the Markets into the green but went on to form the day’s high of 7906.95. Markets perked up nearly 90-odd points from the low point. However, the Markets failed to sustain those levels. The second half of the session witnessed sideways movement but the Markets slid in the last hour of the trade. It pared nearly all of its gains and finally settled the day at 7856.55, posting a net gain of 13.80 points or 0.18% while forming a higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR MONDAY, NOVEMBER 23, 2015

Today’s session remain important in a different way for the Markets. Today we enter into expiry week of the current derivative series and the Markets have been consolidating while consistently shedding Open Interest in the previous week. Today as well, we are likely to see modestly positive opening and key would be to see if the Markets are able to build up further on these opening gains. The unscheduled meeting of the Federal Reserve will have some effect on the sentiments of the Markets as well.

For today, the levels of 7900 and 7935 are immediate resistance for today. The supports come in at 7800 and 7740 levels.

The RSI—Relative Strength Index on the Daily Chart is 42.7954 and it remains neutral as it shows no bullish or bearish divergence. The Daily MACD remains bearish as it trades above its signal line. On the Weekly Charts, the RSI is 42.5226 and this too remains neutral as it does not show any bullish or bearish divergences.  The Weekly MACD too continues to remain bearish as it trades below its signal line.

On the derivative front, the NIFTY November futures continued to shed over 8.92 lakh shares or 5.35% in Open Interest. The NIFTY PCR stands at 0.78 as against 0.79 on Friday. The Markets have been witnessing a situation wherein it the shorts are grossly uncomfortable on the lower side but in the same breadth, all the up moves have been purely on account of short covering.

While having a look at pattern analysis, the Markets have consolidated all throughout the previous week. Though it has attempted to form a bottom, it has not done so far and is yet to confirm any bottom. For the Markets to confirm its bottom successfully, it will have to maintain supports around 7725 levels in event of any downsides. Any further weakness, if any, will have the Markets test its important pattern supports of 7680 levels. The outcome of the meeting of the Federal Reserve in December will have its sentimental effect on the Markets as well even if the rate hike of 25 bps stands more or less discounted.

Overall, the Markets are likely to continue to trade in a range and it would be important to see if the Markets sustain its likely opening gains and builds up on that. For the Markets to form a bottom successfully, it will require upsides with good participation and fresh longs rather than mere short coverings. Until this happen we will continue to see the Markets vulnerable to sell-offs as we have seen all through previous week. Cautious approach is continued to be advised on Markets today as well.

Milan Vaishnav,
Consulting Technical Analyst

Af. Member: Market Technicians Association, (MTA), USA
Af. Member: Association of Technical Market Analysts, (ATMA), INDIA
www.EquityResearch.asia
http://milan-vaishnav.blogspot.com

+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com