Gemstone Equity Research & Advisory Services

Monday, March 3, 2014

Daily Market Trend Guide -- Monday, March 03, 2014

MARKET REPORT March 03. 2014

The Markets had a positive session on Friday as it opened positive, remained in capped range and saw a spurt in the second half of the session to end the fifth day with gains. The Markets opened on a modestly positive note. After opening on a modestly positive note, the Markets spend the first half of the session in a capped range. Though it traded in a very narrow band, it continued to remain in positive territory though it came off its opening highs to form the day’s low of 6228.10. However, the second half of the session saw some strength coming in the Markets as it strengthened further. It saw a sharp gains across the board and went on to form the day’s high of 6282.70. It finally managed to end the day at 6276.95, while posting net gain of 38.15 points or 0.61% while forming a higher top and higher bottom on the Daily High Low Charts.

MARKET TREND FOR TODAY

Today, expect the Markets to open on a flat to mildly negative note and look for directions. The Markets have risen over past several sessions and the chances of positive consolidation cannot be ruled out. There are chances that we may see the session in a capped range with some minor profit taking being seen initially. However, the intraday trajectory would remain important as under current continues to have positive bias.

For today, the levels of 6310 and 6350 will act as immediate resistance levels. The supports would exist at 6245a and 6230 levels.

The lead indicators continue to remain perfectly in place. The RSI—Relative Strength Index on the Daily Chart is 63.3690 and it has reached its highest value in last 14-days which is bullish. It does not show any bullish or bearish divergence. The Daily MACD is bullish as it trades above its signal line.

On the derivative front, NIFTY March futures have added 98,300 shares in Open Interest. The NIFTY PCR remains unchanged at 0.94. Fresh longs have seen to have been added in the second half of the session.

The Markets have successfully reversed their trend after taking support at its 200-DMA couple of times. Currently the Markets have successfully given a trend reversal and now trades above all of its DMAs. In even of consolidation, the Markets should see a range bound trade while trading above all of its DMAs.

All and all, today, though some consolidation and mild profit taking cannot be ruled out, the overall under current certainly continues to remain bullish. In case of some downticks, shorts should be avoided and such situations should be used to make selective purchases as sectoral out performance would continue. Overall, while protecting profits at higher levels, positive outlook is advised for today.

Milan Vaishnav,

Consulting Technical Analyst,

www.MyMoneyPlant.co.in

http://milan-vaishnav.blogspot.com

+91-98250-16331

milanvaishnav@mymoneyplant.co.in

milanvaishnav@yahoo.com

Wednesday, February 26, 2014

Daily Market Trend Guide -- Wednesday, February 26, 2014

MARKET REPORT February 26, 2014

The Markets had a session of positive consolidation today as it remained in arrange, with some volatility on expected lines and ended the day on a positive note. The saw itself opening on a positive note and after a decent opening, the Markets gained some more strength as it recorded its day’s high of 6216.85. However, the Markets pared all of its gains in the first half of the session. It came off its early highs and in the afternoon trade dipped in the negative for a brief period while forming the day’s low of 6176.60. The Markets saw reversal of intraday trend as it traded back into positive territory and saw much of its losses being recovered. It finally managed to end the day at 6200.05, posting a modest gain of 13.95 points or 0.23% while continuing to form a higher top and higher bottom on the Daily High Low Charts.

MARKET TREND FOR TODAY

The Markets are expected to open on a quiet note again and would look for directions. The yesterday’s session saw some positive consolidation and today’s session would remain more or less on similar lines. Today, we will have expiry of current February series (Tomorrow being a trading holiday) and this would continue to see the session remaining dominated with rollovers and positive consolidation.

For today, the levels of 6220 and 6255 would act as immediate resistance on the Charts whereas the levels of 6180 and 6165 would act as immediate supports.

The lead indicators continue to remain perfectly in shape. The RSI—Relative Strength Index on the Daily Chart is 57.2139 and it has reached its highest value in last 14-days which is bullish. It does not show any bullish or bearish divergence. The Daily MACD continues to remain bullish as it trades above its signal line.

On the derivative front, rollovers continued as NIFTY February futures shed over 26 lakh shares or 21.01% in Open Interest whereas March series added over 35% in total open interest.

Going by the pattern analysis, the Markets have moved past its 100-DMA and 50-DMA at Close. If the consolidation has to the Markets will have to remain in a capped range with the levels of 100-DMA acting as bottom. The Markets will have to maintain levels above of 100-DMA or say, 6160-6150 range in order to avoid any weakness creeping in again and maintain its up move.

All and all, the Markets are likely to spend some time in a range. Given expiry today, the Markets are likely to see some volatility as well and might witness a bidirectional movement. However, the undercurrent certainly remains intact as of now. While avoiding shorts, selective purchases may be made. Any existing profits on the up side should be protected as well. Sectoral out performance would continue. Overall, cautious optimism is advised for today.