Gemstone Equity Research & Advisory Services

Wednesday, September 20, 2017

MARKET OUTLOOK FOR WEDNESDAY, SEP 20, 2017

MARKET OUTLOOK FOR WEDNESDAY, SEP 20, 2017

Much on the expected lines, the benchmark NIFTY50 did not see any runaway rise despite a buoyant session a day before. The Markets on Tuesday saw the Index oscillating in a 25-point range while it ended flat with negligible loss of 5.55 points or 0.05%. On Wednesday, we expect the Markets to continue to consolidate and struggle to clear the immediate resistance zone of 10150-10170. Even if it does manage to mark new highs, it will continue to remain vulnerable to volatile profit taking bouts form higher levels. Going on, we will see more stock-specific Markets then a general trend.

The levels of 10170 and 10230 will continue to pose immediate resistance to the Markets. Supports come in at 10090 and 10025 levels.

The Relative Strength Index – RSI on the Daily Chart is 65.6080 and it stays neutral showing no divergences against the price. Daily MACD stays bullish while trading above its signal line. No significant formations were observed on Candles.

While the NIFTY continued to trade comfortably in the multi-month upward rising channel that it has formed over couple of days, the size of the bar is getting smaller due to reduced intraday bands. This often reflects indecisiveness among participants.

All in all, we feel that couple of sessions going ahead is more likely to remain stock-specific ones. Any runaway rise in the NIFTY is not expected. If the NIFTY moves past its recent highs and marks fresh highs, then the vulnerability of the Markets facing volatile profit taking bouts too will increase. We recommend continuing to adopt stock specific approach in the sessions to come while maintaining cautious view on the Markets. Shorts should be avoided as inherent trend remains intact.

Milan Vaishnav, CMT, MSTA

Technical Analyst

(Research Analyst, SEBI Reg. No. INH000003341)

Member:

CMT Association (Formerly known as Market Technicians Association, (MTA), USA

Canadian Society of Technical Analysts, (CSTA), CANADA

Society of Technical Analysts (STA), UK

www.EquityResearch.asia

http://milan-vaishnav.blogspot.com

+91- 70164-32277 / +91-98250-16331

milan.vaishnav@equityresearch.asia

milanvaishnav@yahoo.com

Tuesday, September 19, 2017

MARKET OUTLOOK FOR TUESDAY, SEP 19, 2017

MARKET OUTLOOK FOR TUESDAY, SEP 19, 2017

The Indian Equity Markets had a better-than-expected session on Monday as it opened strong and ended the day with net gains of 67.70 points or 0.67%. However, the benchmark NIFTY50 saw this up move on back of sharp short covering. Though we may expect a stable start to the Markets on Tuesday, there are ample signs that the Markets may not see a sustainable up move even if it continues to post intermittent lifetime highs. The zones of 10150-10170 still need to be comprehensively breached and while it happens, we cannot ignore the signs of weariness that are appearing on the Charts.

The levels of 10170 and 10265 will act as immediate resistance levels for the Markets. Supports come in at 10080 and 10010 levels.

The Relative Strength Index – RSI on the Daily Chart is 66.2278 and it has reached its highest value in last 14-days which is bullish. No divergence is seen against the price. The Daily MACD continues to stay bullish while trading above its signal line. A Rising Window” that occurred on the Candles may result into some continued up move on Tuesday.

The pattern analysis show the Market slowly inching up towards the upper zone of the rising channel that it has been trading in. The intraday bands are getting shorter as the NIFTY has remained in a very narrow intraday range over past couple of days.

There are few things that warrant our attention and requires the Market Participants to be cautious about. The NIFTY PCR (Put to Call Ratio) remains at its highest in recent times. The VIX remains at its lowest levels which signals high amount of complacency of the participants. Further, the previous up move has resulted out of a short covering as it has come with reduction in Open Interest. We recommend remaining extremely cautious and adopt stock specific outlook on the Markets.