MARKET OUTLOOK FOR WEDNESDAY, JULY 12, 2017
In our previous note, we had cautioned about not getting
carried away by the Monday’s up move as the NIFTY moved up more because of
short covering than anything else. The signs of fatigue remained evident in
Tuesday’s session as the Markets pared most of its gains after marking fresh
life time highs. The benchmark NIFTY50 ended with minor gains of 15 points or
0.15%. We expect a quiet start to the Markets and see the Markets remaining in
a capped range. Some shorts were seen added and we expect some consolidation to
return to the Markets.
The levels of 9800 and 9830 will act as resistance to the up
move. The supports come in much lower at 9720 and 9685 zones.
The Relative Strength Index – RSI on the Daily Chart is
70.2157 and it has marked a fresh lifetime high which is bullish. However, this
trades mildly overbought. The Daily MACD stays bullish while trading above its
signal line.
The pattern analysis shows Market successfully moving past
the rising trend line drawn from 9200 levels. In event of any consolidation,
this trend line is once again expected to act as support.
Overall, with the underlying current remaining intact, we
expect the Markets to consolidate. With any runaway rise that it may see, the
Markets will remain equally vulnerable to profit taking bouts at higher levels.
We recommend remaining extremely stock specific and preserve more cash while
protecting profits at higher levels.
Milan Vaishnav, CMT
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member:
Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
+91-98250-16331
