Gemstone Equity Research & Advisory Services

Friday, June 19, 2015

Daily Market Trend Guide -- Friday, June 19, 2015

MARKET REPORT June 19, 2015

Precisely on the analysed lines, the Markets continued to post decent gains for the fifth day in a row as it continued with its up move and ended the day with decent gains. The Markets saw positive opening and it continued to remain in positive territory through out the session. Post opening in the positive zone, the Markets formed an upward rising channel and continued with this formation until the end. It went on to form the day’s high of 8186.90 by late afternoon trade. Markets came off mildly from those levels but more or less maintained its gains. It finally settled the day at 8174.60, posting a net gain of 83.05 points or 1.03% while continuing to form a higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR FRIDAY, JUNE 19, 2015

Today as well, we can fairly expect the Markets to open on a modestly positive note and trade positive at least in the initial trade. The Markets are back in to the broad trading range and they are likely to continue with its up move and approach its falling trend line and / or its 50-DMA in immediate near term. The Markets have held on its major bottom of 8000-mark which will continue to act as major bench mark support in the immediate short term.

For today, the levels of 8245 and 8310 are immediate levels for resistance whereas the supports exist at 8100 and 8050.

The RSI—Relative Strength Index on the Daily Chart is 49.0992 and it remains neutral as it shows no bullish or bearish divergence or any failure swings. The Daily MACD has reported a positive crossover and is now bullish while trading above its signal line.

On the derivative front, the NIFTY June futures have added over 2.29 lakh shares or 1.46% in Open Interest. This is a important indication to show that the yesterday’s up move has not resulted any short covering but is now being moderately replaced with fresh buying.

Coming back to pattern analysis, though the Markets have maintained and held on to its support of 7950-8000 levels, it has just attempted to form the bottom. However, as of today, the Markets still continues to remain in the intermediate corrective trend and still trades within the falling channel. In due course of time, it is expected to continue with its up move and encounter resistance near its 50-DMA levels which also coincides with the falling trend line. Key would be to see if that results into consolidation and if the Markets resume its up move and goes for confirmation of bottom.

All and all, as mentioned, until the confirmation occurs, the Markets will continue to remain in the broad trading range and downward sloping corrective channel. The immediate resistance for the Markets would be near its 50-DMA. Markets, therefore, still has some room for upside before it consolidates. Sectoral out performance will continue and therefore selective buying can be done. Positive caution is advised for the day.

Milan Vaishnav,

Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA

www.MyMoneyPlant.co.in

http://milan-vaishnav.blogspot.com

+91-98250-16331

milanvaishnav@mymoneyplant.co.in

milanvaishnav@yahoo.com

Thursday, June 18, 2015

Daily Market Trend Guide -- Thursday, June 18, 2015

MARKET REPORT June 18, 2015

Markets continued to surge and end yet another day with gains though it came off considerably from the high point of the day. The Markets saw a positive opening and after opening on modestly positive note traded with capped gains in the morning trade. The Markets then transformed itself into rising trajectory and remained in upward rising channel for the most part of the day. By late afternoon trade, the Markets went on to form the day’s high of 8136.85. It was in the last 30-minutes of the trade that the Markets suddenly saw some paring of gains which was seen as a caution ahead of the US Fed Reserve outcome, which had a consensus of no change of rate. It finally settled the day at 8091.55, posting a modest gain of 44.25 points or 0.55% while continuing to form a higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR THURSDAY, JUNE 18, 2015

Today, expect the Markets to open on a modestly positive note and look for directions. Overall, with no objectionable wordings from the Fed Reserve, the Markets are expected to consolidate and continue with its up move. However, it will continue to remain in a broad trading range and some amount of volatility ingrained in it.

The levels of 8150 and 8225 will act as immediate resistance and the supports will come in at 8040 and 7990 levels.

The RSI—Relative Strength Index on the Daily Chart is 43.7610 and it remains neutral without showing a bullish or bearish divergence or any failure swings. The Daily MACD continues to remain bearish as it still trades below its signal line. However, it has flattened out and might report a positive crossover in coming days.

On the derivative front, NIFTY June futures have added 94,875 shares or 0.61% in Open Interest. This shows that there was no major shedding of open positions on Close basis. Also some shorts too seem to have been added in the system.

Coming to pattern analysis once again the Markets now continue to trade in a broad trading range of 8000-8350 levels. Though it has successfully managed to come back into the broad trading range after a brief breach of its support, it has attempted to form a bottom but has not yet confirmed it. It still continues to remain within a intermediate downtrend. However, there is some room still left on the upside following with the Markets might consolidate and attempt to confirm the bottom that it has formed.

Overall, the Markets are likely to trade in a given range with somewhat weak directional bias. However, the overall bias remains on the upside. Some stock specific purchases can be made while protecting profits at higher levels as the Markets will continue to remain vulnerable to profit taking bouts from higher levels. Overall, cautious optimism is advised for the day.