Daily Market Trend Guide -- Monday, November 16, 2015

MARKET REPORT                                                                                   November 16, 2015

Markets saw no respite from the weakness and continued to wear a bearish tone on Friday as it ended yet another day with losses. The Markets saw near gap down opening as it opened quite lower than its previous Close after trading somewhat in a range in the morning trade, slipped further in the late morning trade for form its intraday low of 7730.90. It saw somewhat getting stabilized as it spent the first half of the session recovering from those lows. Thereafter, the session continued virtually directionless as the Markets traded sideways in a very narrow trajectory and in a much capped range. It headed nowhere and it did not recover as well from its lows. It finally settled the day at 7762.25, posting a net loss of 62.775 points or 0.80% while forming a sharply lower top and lower bottom on the Daily Bar Charts.

MARKET TREND FOR MONDAY, NOVEMBER 16, 2015

The Markets have ended with losses in 12 out of 14 sessions and this speaks of the nervousness of the Markets. In the process, it has come off nearly 500-plus points from its intraday high. Today as well, we are expected to see the Markets opening on a modestly negative note and trade negative, at least in the initial trade. However, the Markets are trading nearly oversold and we may see the pattern supports of 7680 levels coming into play once again. But if the Markets remain weak and test those levels, it is still some 60-80-odd point gap for a downside.

For today, the levels of 7775 and 7840 are immediate resistance levels for the Markets. The supports come in at 7730 and 7680 levels.

The RSI—Relative Strength Index on the Daily Chart is 30.1556 and it stands nearly oversold. It does not show any failure swing as well. There is bullish divergence seen as the NIFTY has formed a fresh 14-period low while RSI has not.  The Daily MACD remains bearish as it trades below its signal line. On the Weekly Charts, the Weekly RSI is 39.7419 and it remains neutral as it shows no bullish or bearish divergence or failure swings. The Weekly MACD too remains bearish as it trades below its signal line.

On the derivative front, the NIFTY November shed over 1.50  lakh shares or 0.56% in Open Interest. This signifies some unwinding continued in the Markets. The NIFTY PCR stands at 0.71 as against 0.72 on the previous day. This too stands nearly oversold.

Coming to pattern analysis, the Markets continue to portray weakness on the Daily Chart and are likely to test its long term pattern support of 7680 levels. However, at the same time, it should also not be overlooked that the Markets are trading nearly oversold and the lead indicators suggest that the Markets might once again try and find support around these levels. Given this fact, there are chances that the Markets see some weakness but at the same time attempts to find support at lower levels and the downside now may remain limited beyond 7680 levels if at all they are tested.

Overall, the Markets remain weak on the Daily Chart and the technical structure suggests continuation of weakness in the immediate short term. However, given the fact that the Markets remain nearly oversold on Daily Charts, some amount of technical relief rally later today or in this week cannot be ruled out. Overall, while maintaining modest exposures and adequate liquidity cautious outlook should be continued in 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

+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com

Daily Market Trend Guide -- Friday, November 13, 2015

MARKET REPORT                                                                              November 13, 2015

The Markets session on the Muhurat Trading remained typically as like any other muhurat session as the Markets opened higher, remained in a capped and narrow range but ended the day quite on a good positive note. The Markets saw a relatively stronger opening and formed its intraday high of 7847.95 in the early minute of the hour-long session. Soon after that, the Markets gradually kept paring gains but overall continued to maintain its gains. It spent the hour-long session in a relatively capped and narrow range. After spending the short session in 25-odd points range, the Markets finally settled the day at 7825, posting a net gain of 41.65 points or 0.54% while forming a lower top but higher bottom on the Daily Bar Charts.

MARKET TREND FOR FRIDAY, NOVEMBER 13, 2015

Markets are not completely out of the woods but the oversold nature of the Markets saw some positive upticks on expected lines on Wednesday. However, today, we are once again likely to see a negative opening in the Markets. However, the fact that any negative opening in the Markets will once again make the Markets oversold, the analysis continues to remain more or less on similar lines. This translates into possibilities of the Markets recovering once gain after a negative opening.

For today, the levels of 7850 and 7890 will act as immediate resistance levels for the Markets. Supports come in at 7775 and 7730 levels.

The RSI—Relative Strength Index on the Daily Chart is 33.1378 and it is neutral as it shows no bullish or bearish divergence or any failure swing. The Daily MACD continues to remain bearish as it trades below its signal line.

On the derivative front, the hour-long session on Wednesday, the NIFTY November futures have shed over 1.04 lakh shares or 0.59% in Open Interest. This shows continuation of some offloading and unwinding of positions in the Markets.

Having a look at pattern analysis, the Markets attempted to form some base near the levels of 7775. However, given the structure of the Charts, any continuing weakness will see the Markets testing its support levels of 7680 levels in the immediate short term. Again, it is important to note that the Markets will once again get nearly oversold any downsides at close levels. This will ensure that the Markets see little and limited downsides and does not make any significant breach on the Daily Charts.

Overall, with the lower opening expected, the Markets are once again set to test its immediate support levels. However, taking a combined look at the technical structure of the Market, its lead indicators and the F&O data, the chances remain that post negative opening; it will either attempt to recover as the day progresses or will keep its downsides limited. It is advised to keep exposures limited and maintain liquidity while adopting a cautious outlook 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

+91-98250-16331
milan.vaishnav@equityresearch.asia
milanvaishnav@yahoo.com