Monday, April 4, 2011

Daily Market Trend Guide -- Monday, April 04, 2011

MARKET TREND FOR TODAY


After eight straight days of gains, the Markets finally showed some signs of weariness / consolidation as it ended the day with negligible losses and in the process have formed a lower top but higher bottom on the Daily High Low Charts.

Today, following the positive closing in the US Markets and stable trading Asian Markets, we are likely to see a positive opening again in the Markets after a day of consolidation.

However, even with the Markets expected to give a positive opening, given its technicals, the trend would continue to depend again on the intraday trajectory that it forms. For today, the levels of 5872 and 5910 shall act as resistance and the levels of 5775 and 5710 shall act as immediate supports. The RSI—Relative Strength Index on the Daily Chart is 67.6349 and is neutral as it shows no negative divergence or a failure swing. The Daily MACD continues to trade above its signal line.

On Candles,
A Spinning Top has occurred. During a rally, (which is the case with NIFTY), this is a typical sign that potentially signals the loss of momentum in the Markets and some likelihood of beginning of Correction. On the Weekly Charts, the Weekly MACD is BEARISH as it trades below its signal line, however the RSI Continues to remain neutral.

Given this reading, the Markets have taken a breather as expected in our Friday’s edition of Daily Market Trend Guide. Even with positive global cues, the Markets are overdue for correction / consolidation given both, the technical and chart pattern analysis of the Markets. Today, there are all chances that the Markets may give positive opening  but later comes back in consolidation / correction mode after a brief intraday high. All and all, as in last couple of days, we continue to sound caution at these levels and structure in the Markets. Continuation of cautious approach while avoiding longs is advised for today.
  

Milan Vaishnav,
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
+91-9825016331

milanvaishnav@mymoneyplant.co.in
milanvaishnav@yahoo.com

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