Daily Marekt Trend Guide -- Wednesday, June 29, 2011

MARKET TREND FOR TODAY

The Markets yesterday remained volatile but range bound as it pared its initial gains but later recovered to close with modest gains and in the process have formed a similar top but higher bottom on the Daily High Low Charts.

Today is going to be no different as the Markets are likely to open on a positive note but has a bright chances to correct and consolidate later with the intraday trajectory playing a critical role.

For today, expect the Markets to open on a positive note and look for directions. With the Markets expected to open on a positive note, the levels of 5560 and 5595 shall continue to act as resistance and the levels of 5496 and 5460 are likely to act as supports. The 50 and 100 DMA levels of 5531 and 5540 shall continue to act as possible resistance at the Close levels.

The RSI—Relative Strength Index on the Daily Chart is 57.4096 and is shows no negative divergence. Since it has reached its highest value in last 14 days, it is bullish. The Daily MACD continues to trade above its signal line.

On Candles, A Spinning Top has occurred. During a rally or near new highs this can be a sign that the prices are losing momentum for the immediate short term.

Having said this, FIIs have remained net sellers in NIFTY Contracts by 3091 contracts and in Stock Futures by over 22000 contracts.

Secondly, the Markets have not yet been able to significantly move past and Close above its 50 and 100 DMA as is still within in filters. With the Markets seeing a pullback of over 5%, come mild correction or consolidation is required to keep this pullback healthy and sustainable in the long run and it seems imminent.

All and all, there are chances that after a positive opening, the Markets starts consolidation / mildly correcting again. It is continued to be advised to remain highly stock specific in action and keep protecting profits at higher levels. As like yesterday, cautious approach is advised for today.

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