MARKET REPORT August
24, 2015
Following global weakness, the Indian Markets as well
responded to it as it opened with a gap down and ended the day with losses
though it did see some recovery in the final hours of the trade. The Markets
saw itself finally breaching the neckline of the Head and Shoulders formation
that we have been mentioning often in our previous editions of the Daily Market
Trend Guide. The Markets saw a gap down opening amid global mess and opened
nearly 1.50% gap down. It made its intraday low of 8225.05 in the early minutes
of the trade and thereafter and saw itself trading in a very narrow and capped
range. The Markets traded in some 25-odd points range while it also saw each of
its minor recovery being sold into. However, the second half of the session;
especially the last hour and half of the trade saw the Markets attempting a
recovery. It recover somewhat 50-odd significant points and finally ended the
day at 8299.95, posting a net loss of 72.80 points or 0.87% forming a sharply
lower top and lower bottom on the Daily Bar Charts.
MARKET TREND FOR MONDAY, AUGUST 24, 2015
In our previous editions of Daily Market Trend Guide, we
have been mentioning of a bearish formation – Head and Shoulders – on the Daily
Charts. The Markets gave a downward breach on Friday from its neckline.
Unfortunately, today as well, we are set to see yet another gap down opening in
the Markets. The Markets are likely to open on a significantly lower note.
However, on the same lines, it should be note that India shall see a relative
outperformance even in the weaker times and it is likely that the Markets tries
to find its bottom after such significantly negative opening.
For today, the levels of 8205 and 8140 are likely to act as
immediate supports for the Markets on Daily Charts.
The RSI—Relative Strength Index on the Daily Chart is 40.2168
and it has reached its lowest value in last 14-days which is bearish. It does
not show any bullish or bearish divergence. The Daily MACD too remains bearish
as it trades below its signal line. On the Weekly Charts, the Weekly RSI is
46.9134 and it is neutral as it shows no bullish or bearish divergence. Weekly
MACD still remain bullish as it trades above its signal line.
On the derivative front, NIFTY August futures have added
79,550 shares or 0.54% in Open Interest. This figure is insignificant to reach
any conclusion however; bulk of it came down in the last hours of the trade on
Friday.
Coming to pattern analysis, the Markets have broken down
from the neckline of the Head and Shoulder Formation and today as well, with
the gap down opening expected, it is likely to continue with its downsides.
However, if we apply the measuring implication of this formation, today’s
opening is likely to coincide with it supports. Given this fact, we may see the
Markets continuing to trade with opening losses in the first half of the session but may see some resilience in the
second half.
Overall, the Markets are set to see a negative gap down
opening but are also likely to open at its expected supports. We can see some
outperformance coming into the Markets later in the day and we might see the
Markets NOT going beyond its opening losses. We will see some buying coming in
at lower levels as we saw on Friday as well. However, given the uncertain
current global Markets, it is advised to refrain from taking any major call on
the Markets.
Milan
Vaishnav,
Consulting Technical Analyst
Af. Member: Market Technicians Association, (MTA), USA
Af. Member: Association of Technical Market Analysts, (ATMA), INDIA
www.EquityResearch.asia
http://milan-vaishnav.blogspot.com
Consultant to:
www.MyMoneyPlant.co.in
+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com
Consulting Technical Analyst
Af. Member: Market Technicians Association, (MTA), USA
Af. Member: Association of Technical Market Analysts, (ATMA), INDIA
www.EquityResearch.asia
http://milan-vaishnav.blogspot.com
Consultant to:
www.MyMoneyPlant.co.in
+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com
