Daily Market Trend Guide -- Friday, May 20, 2011

MARKET TREND FOR TODAY

The Markets spent the entire session in a very narrow range, again heading nowhere on lower than average volumes. However, in the process, it has formed a lower top but slightly higher bottom on the Daily High Low Charts.

Today is going to be no different than last couple of sessions as the Markets are likely to open on a flat note and look for directions again. With the Markets expected to open flat, the intraday trajectory and especially the volumes will play key role in determining the trend for today as well as for coming day. For today, the levels of 5460 and 5495 shall act as resistance and the levels of 5405 and 5380 shall act as supports.

All lead indicators continue to remain in place. The RSI—Relative Strength Index on Daily Charts is 36.0304 and is neutral as it shows no negative divergence or failure swings. The Daily MACD continues to trade below its signal line. On the Weekly Charts, the Markets continues to trade near the trend line support of the rising trend line. Again, as like in last couple of sessions, the Markets have continued to add Open Interest signifying short positions. Though FII activity have remained muted in last 3-4 sessions, they have remained net buyers, though of small quantity.         

 
All and all, indecisiveness shall continue in the Markets until the markets move past  the levels of 5440-5445. Until this happens, the Markets may continue to trade volatile and range bound on lower volumes. Again, while avoiding shorts, cautious approach is advised for today.

Milan Vaishnav,
Consulting Technical Analyst,
www.MyMoneyPlant.co.in
+91-9825016331
milanvaishnav@mymoneyplant.co.in
milanvaishnav@yahoo.com