MARKET TREND FOR TODAY
June 15, 2012
Caution weighed heavy on the Markets yesterday as the
Markets took some breather and corrected itself as it ended the day with losses
after moderately positive opening as it reacted to Inflation number which were
perceived to be high enough to discourage RBI from any aggressive rate cut on
Monday. The Markets opened and traded in a range ahead of announcements of
Inflation numbers and saw a spurt just ahead of that as it gave its intraday
high of 5130. It turned negative soon after that as it kept steadily losing
ground and went on to give the day’s low of 5047.60. It finally ended the day
at 5054.75, posting a net loss of 66.70 points or 1.30%. It has formed a lower
top and sharply lower bottom on the Daily Charts. The volumes remained below average.
Today would be a crucially important session for the
Markets. The Markets have ended the notch below 200-DMA which is 5070. With
moderately positive opening expected today, it would be important for the
Markets to open above 200-DMA and sustain the levels above 200-DMA at Close to
avoid this consolidation taking a further weakening stance.
The levels of 5495 and 5125 are immediate resistance
levels and the levels of 5020 and 5005
are immediate supports on the Daily Charts.
The lead indicators continue to comfortably remain in place
with RSI—Relative Strength Index on the Daily Chart at 53.9635 and it remains
neutral with no failure swings or negative or positive divergence. The Daily
MACD too remains bullish as it trades above the signal line.
The Stock Futures
have recorded a moderate decline in net Open Interest and also the NIFTY
futures. However, the NIFTY PCR still leaves significant room on the upside,
but the levels of 5144 would continue to act as immediate top for the Markets.
Today’s session would see the consolidation to continue.
With the Markets expected to open above 200-DMA, it would be critically
important for the Markets to remain in positive upward trajectory and sustain
the levels above of 200-DMA to avoid any further weakness. For this, the
intraday trajectory would be important. Even if the Markets consolidates, and
maintains the levels above of 200-DMA. It would still be in the broad range of
5050-5144 and fresh up move shall occur only after the Markets moves past the levels of 5144.
All and all, until the Markets moves past the levels of
5144, consolidating activities shall remain and volatility will refuse to go
away. Further weakness would creep in only if the Markets significantly closes
below 200-DMA otherwise, it is expected to trade in the broad range. It is
advised to maintain liquidity and refrain from any aggressive positions on
either side. Overall, continuation of cautious approach is advised for today.
Milan
Vaishnav,
Consulting
Technical Analyst,
+91-98250-16331
